R-Squared Energy Blog

Pure Energy

Wood Versus Fuel

I know it has been a week since I put up something new. Some readers have also noticed that I haven’t been commenting much lately, and my e-mails are piling up. Things have just been really busy. I have a few guest posts that should be ready to go within a week or so, but I saw a topical story this morning that was worth commenting on:

The unintended ripples from the biomass subsidy program

The issue of incentives for biofuels increasing the demand for grains and thus helping drive up food prices is often called “Food versus Fuel.” There is also an incentive program (Biomass Crop Assistance Program) designed to encourage the use of biomass for heat, power, or biofuels. As is almost always the case, there were unintended consequences:

While it remains unclear whether Congress or the Obama administration will push to revamp the program, even some businesses that should benefit from the subsidy are beginning to question its value.

“It’s not right. It’s not serving any purpose,” said Bob Jordan, president of Jordan Lumber & Supply in North Carolina, even while noting that he might be able to get twice as much money for his mill’s sawdust and shavings under the program.

“The best thing they could do is forget about it. All it’s doing is driving the price of wood up.”

Sounds like “Food versus Fuel” except in this case it is the cost of wood – not food – that is being driven higher. The thing is that there are always trade-offs and always unintended consequences. We have to be wise enough to change policies in cases where the unintended consequences outweigh the benefits. But you have to look at the big picture as well. Were there also unintended benefits? Things like that must be considered.

In this case, I don’t know whether the unintended consequences outweigh the benefits. I think it is too early to know for sure. But in any case, higher cost biomass is something I expect in the future. I made this point in my presentation at the Pacific Rim Summit. If your business model is based on either tipping fees, or just free or very cheap biomass – then I doubt that model is sustainable. I think as more companies attempt to turn biomass into fuel, competition will heat up and free or negative-valued biomass will be a thing of the past.

Therefore, I think the safe bet is to plan for 1). Escalating biomass prices; 2). No government assistance. I have no objections to getting started with government assistance, but if you don’t have a clear plan for operating in a subsidy-free environment, then you may just be wasting taxpayer money up until the point that your business fails because conditions changed (in a way that you should have anticipated).

January 11, 2010 Posted by | biomass, energy policy, farm policy, politics, USDA | Comments Off on Wood Versus Fuel

USDA Cellulosic Ethanol Reality Check

I was getting some traffic from Grist, and I tracked it back to this story by Tom Philpott:

The USDA goes all lukewarm on cellulosic ethanol

Now this is good stuff. The same outfit that has exaggerated corn ethanol is now downplaying expectations for cellulosic ethanol:

For decades now, the USDA has been dumping cash into cellulosic ethanol research (most recently through a joint venture with the DOE).

So the USDA’s analysts should know something about the prospects for mass production of cellulosic ethanol, hailed by its boosters as a panacea that can wean us not only from oil, but also from corn as an ethanol feedstock.

So what’s the latest from USDA analysts on this miracle fuel? From a report released last week:

“Although cellulosic-based production of renewable fuels holds some longer-term promise, much research is needed to make it commercially economical and expand beyond the 250-million-gallon minimum specified for 2013 in the Energy Policy Act of 2005.”

Heh. Some “longer-term promise.” This in contrast to Vinod Khosla’s “We are going to produce cellulosic ethanol for $1 a gallon and run the country on it.”

Tom then cuts right to the point I have been trying to drive home:

What the researcher is saying is that six years from now, in 2013, cellulosic still won’t be economically viable. For decades now, cellulosic boosters have been promising a major breakthrough within five years. And the future cellulosic utopia keeps receding ever-further into the future.

I will be the first to say that we really need cellulosic ethanol, or some kind of economical petroleum alternative to work. But there is a disconnect between reality, and the perception in the minds of the public and of our politicians. They think that because we need economic cellulosic ethanol, we will get it. Of course that perception is bolstered when Vinod Khosla appears before the Senate Foreign Relations Committee and tells them that cellulosic ethanol is the cure to our ills. All the government has to do is to mandate it and throw money at it, and we shall have it. You know, while they are at it, I wish they would mandate a cure for cancer.

September 15, 2007 Posted by | cellulosic ethanol, energy policy, USDA, Vinod Khosla | 8 Comments

USDA Cellulosic Ethanol Reality Check

I was getting some traffic from Grist, and I tracked it back to this story by Tom Philpott:

The USDA goes all lukewarm on cellulosic ethanol

Now this is good stuff. The same outfit that has exaggerated corn ethanol is now downplaying expectations for cellulosic ethanol:

For decades now, the USDA has been dumping cash into cellulosic ethanol research (most recently through a joint venture with the DOE).

So the USDA’s analysts should know something about the prospects for mass production of cellulosic ethanol, hailed by its boosters as a panacea that can wean us not only from oil, but also from corn as an ethanol feedstock.

So what’s the latest from USDA analysts on this miracle fuel? From a report released last week:

“Although cellulosic-based production of renewable fuels holds some longer-term promise, much research is needed to make it commercially economical and expand beyond the 250-million-gallon minimum specified for 2013 in the Energy Policy Act of 2005.”

Heh. Some “longer-term promise.” This in contrast to Vinod Khosla’s “We are going to produce cellulosic ethanol for $1 a gallon and run the country on it.”

Tom then cuts right to the point I have been trying to drive home:

What the researcher is saying is that six years from now, in 2013, cellulosic still won’t be economically viable. For decades now, cellulosic boosters have been promising a major breakthrough within five years. And the future cellulosic utopia keeps receding ever-further into the future.

I will be the first to say that we really need cellulosic ethanol, or some kind of economical petroleum alternative to work. But there is a disconnect between reality, and the perception in the minds of the public and of our politicians. They think that because we need economic cellulosic ethanol, we will get it. Of course that perception is bolstered when Vinod Khosla appears before the Senate Foreign Relations Committee and tells them that cellulosic ethanol is the cure to our ills. All the government has to do is to mandate it and throw money at it, and we shall have it. You know, while they are at it, I wish they would mandate a cure for cancer.

September 15, 2007 Posted by | cellulosic ethanol, energy policy, USDA, Vinod Khosla | Comments Off on USDA Cellulosic Ethanol Reality Check

Energy Balance For Ethanol Better Than For Gasoline?

Surely you have heard the claim. Proponents of ethanol will claim that it takes less fossil fuels to produce a BTU of ethanol than to produce a BTU of gasoline. Here is the claim from a Minnesota Department of Agriculture site (1):

A United States Department of Agriculture (USDA), Economic Research Service Report number 814 titled “Estimating The Net Energy Balance Of Corn Ethanol: An Update” was published in July of 2002. The Conclusion states in part: “Corn ethanol is energy efficient, as indicated by an energy ratio of 1.34; that is, for every Btu dedicated to producing ethanol, there is a 34-percent energy gain.” A similar study done in 1995 indicated only a 1.24 energy ratio.

The concept of “input efficiencies for fossil energy sources” was introduced as a component of the study. This was meant to account for the fossil energy used to extract, transport and manufacture the raw material (crude oil) into the final energy product (gasoline). According to the study, gasoline has an energy ratio of 0.805. In other words, for every unit of energy dedicated to the production of gasoline there is a 19.5 percent energy loss.

In summary, the finished liquid fuel energy yield for fossil fuel dedicated to the production of ethanol is 1.34 but only 0.74 for gasoline. In other words the energy yield of ethanol is (1.34/0.74) or 81 percent greater than the comparable yield for gasoline.

I have dealt with the USDA studies in previous essays, showing the shoddy and misleading methodology they use. But let’s now examine this claim of energy efficiency. Would it surprise you to know that not only is this claim false, it is WAY FALSE?

Let’s do some quick calculations to demonstrate this. A barrel of crude oil contains 5.8 million BTUs (2) of material that will ultimately be turned into gasoline, diesel, jet fuel, etc. It is well-documented that the average energy return on energy invested (EROEI) for crude oil production is around 10/1 (3). Therefore, we will use up about 580,000 BTUs from our barrel getting it out of the ground. The other major input occurs during the refining process, and it also takes roughly 10% of the contained BTUs in the barrel of oil. The total energy input into the process is 1.16 million BTUs, and the energy output was 5.8 million BTUs. The EROEI is then 5.8 million/1.16 million, or 5/1.

For ethanol, the USDA study reference above showed that for an energy input of 77,228 BTUs, an energy output (when co-products were included) of 98,333 BTUs were generated. The EROEI is then 98,333/77,228, or 1.27/1. The efficiency of producing gasoline is then 4 times higher than for ethanol, which makes sense when you think about it.

Crude oil is a highly energy dense mixture. It is contained in underground deposits, and just needs to be pumped out of the ground. During the refining step, large amounts of water don’t need to be distilled out of the product. Contrast this to ethanol. The corn must be planted, grown, and harvested. Processing must take place to turn the corn into crude ethanol. The crude ethanol is actually mostly water, which must be removed in a highly energy intensive distillation. The final product, ethanol, contains only about 70% of the BTU value of the same volume of gasoline. So it would appear that even without doing any rigorous calculations, producing ethanol would be far less energy efficient than producing gasoline.

So, where did the claim that ethanol is more energy efficient originate? I believe it originates with researchers from Argonne National Laboratory, who developed a model (GREET) that is used to determine the energy inputs to turn crude oil into products (4). Since it will take some amount of energy to refine a barrel of crude oil, by definition the efficiency is less than 100% in the way they measured it. For example, if I have 1 BTU of energy, but it took .2 BTUs to turn it into a useable form, then the efficiency is 80%. This is the kind of calculation people use to show that the gasoline efficiency is less than 100%. However, ethanol is not measured in the same way. Look again at the example from the USDA paper, and lets do the equivalent calculation for ethanol. In that case, we got 98,333 BTUs out of the process, but we had to input 77,228 to get it out. In this case, comparing apples to apples, the efficiency of producing ethanol is just 21%. Again, gasoline is about 4 times higher.

OK, so Argonne originated the calculation. But are they really at fault here? Yes, they are. Not only did they promote the efficiency calculation for petroleum products with their GREET model, but they have proceeded to make apples and oranges comparisons in order to show ethanol in a positive light. They have themselves muddied the waters. Michael Wang, from Argonne, (and author of the GREET model) made a remarkable claim last September at The 15th Annual Symposium on Alcohol Fuels in San Diego (5). On his 4th slide , he claimed that it takes 0.74 MMBTU to make 1 MMBTU of ethanol, but 1.23 MMBTU to make 1 MMBTU of gasoline. That simply can’t be correct, as the calculations in the preceding paragraphs have shown.

Not only is his claim incorrect, but it is terribly irresponsible for someone from a government agency to make such a claim. I don’t know whether he is being intentionally misleading, but it certainly looks that way. Wang is also the co-author of the earlier USDA studies that I have critiqued and shown to be full of errors and misleading arguments. These people are publishing articles that bypass the peer review process designed to ferret out these kinds of blatant errors. I suspect a politically driven agenda in which they are putting out intentionally misleading information.

One of the reasons I haven’t written this up already, is that 2 weeks ago I sent an e-mail to Wang bringing this error to his attention. I immediately got an auto-reply saying that he was out of the office until March 31st. I have given him a week to reply and explain himself, but he has not done so. Therefore, at this time I must conclude that he knows the calculation is in error, but does not wish to address it. In the interim, ethanol proponents everywhere are pushing this false information in an effort to boost support for ethanol.

Look at the Minnesota Department of Agriculture claim again: “the energy yield of ethanol is (1.34/0.74) or 81 percent greater than the comparable yield for gasoline”. If the energy balance was really this good for ethanol and that bad for gasoline, why would anyone ever make gasoline? Where would the economics be? Why would ethanol need subsidies to compete? It should be clear that the proponents in this case are promoting false information.

References

1. Ethanol versus Gasoline
2. BTU Content of Common Energy Units
3. Alternative energy: evaluating our options
4. Allocation of Energy Use in Petroleum Refineries to Petroleum Products
5. Updated Energy and Greenhouse Gas Emissions Results of Fuel Ethanol

April 8, 2006 Posted by | energy balance, ethanol, Michael Wang, USDA | 38 Comments

Energy Balance For Ethanol Better Than For Gasoline?

Surely you have heard the claim. Proponents of ethanol will claim that it takes less fossil fuels to produce a BTU of ethanol than to produce a BTU of gasoline. Here is the claim from a Minnesota Department of Agriculture site (1):

A United States Department of Agriculture (USDA), Economic Research Service Report number 814 titled “Estimating The Net Energy Balance Of Corn Ethanol: An Update” was published in July of 2002. The Conclusion states in part: “Corn ethanol is energy efficient, as indicated by an energy ratio of 1.34; that is, for every Btu dedicated to producing ethanol, there is a 34-percent energy gain.” A similar study done in 1995 indicated only a 1.24 energy ratio.

The concept of “input efficiencies for fossil energy sources” was introduced as a component of the study. This was meant to account for the fossil energy used to extract, transport and manufacture the raw material (crude oil) into the final energy product (gasoline). According to the study, gasoline has an energy ratio of 0.805. In other words, for every unit of energy dedicated to the production of gasoline there is a 19.5 percent energy loss.

In summary, the finished liquid fuel energy yield for fossil fuel dedicated to the production of ethanol is 1.34 but only 0.74 for gasoline. In other words the energy yield of ethanol is (1.34/0.74) or 81 percent greater than the comparable yield for gasoline.

I have dealt with the USDA studies in previous essays, showing the shoddy and misleading methodology they use. But let’s now examine this claim of energy efficiency. Would it surprise you to know that not only is this claim false, it is WAY FALSE?

Let’s do some quick calculations to demonstrate this. A barrel of crude oil contains 5.8 million BTUs (2) of material that will ultimately be turned into gasoline, diesel, jet fuel, etc. It is well-documented that the average energy return on energy invested (EROEI) for crude oil production is around 10/1 (3). Therefore, we will use up about 580,000 BTUs from our barrel getting it out of the ground. The other major input occurs during the refining process, and it also takes roughly 10% of the contained BTUs in the barrel of oil. The total energy input into the process is 1.16 million BTUs, and the energy output was 5.8 million BTUs. The EROEI is then 5.8 million/1.16 million, or 5/1.

For ethanol, the USDA study reference above showed that for an energy input of 77,228 BTUs, an energy output (when co-products were included) of 98,333 BTUs were generated. The EROEI is then 98,333/77,228, or 1.27/1. The efficiency of producing gasoline is then 4 times higher than for ethanol, which makes sense when you think about it.

Crude oil is a highly energy dense mixture. It is contained in underground deposits, and just needs to be pumped out of the ground. During the refining step, large amounts of water don’t need to be distilled out of the product. Contrast this to ethanol. The corn must be planted, grown, and harvested. Processing must take place to turn the corn into crude ethanol. The crude ethanol is actually mostly water, which must be removed in a highly energy intensive distillation. The final product, ethanol, contains only about 70% of the BTU value of the same volume of gasoline. So it would appear that even without doing any rigorous calculations, producing ethanol would be far less energy efficient than producing gasoline.

So, where did the claim that ethanol is more energy efficient originate? I believe it originates with researchers from Argonne National Laboratory, who developed a model (GREET) that is used to determine the energy inputs to turn crude oil into products (4). Since it will take some amount of energy to refine a barrel of crude oil, by definition the efficiency is less than 100% in the way they measured it. For example, if I have 1 BTU of energy, but it took .2 BTUs to turn it into a useable form, then the efficiency is 80%. This is the kind of calculation people use to show that the gasoline efficiency is less than 100%. However, ethanol is not measured in the same way. Look again at the example from the USDA paper, and lets do the equivalent calculation for ethanol. In that case, we got 98,333 BTUs out of the process, but we had to input 77,228 to get it out. In this case, comparing apples to apples, the efficiency of producing ethanol is just 21%. Again, gasoline is about 4 times higher.

OK, so Argonne originated the calculation. But are they really at fault here? Yes, they are. Not only did they promote the efficiency calculation for petroleum products with their GREET model, but they have proceeded to make apples and oranges comparisons in order to show ethanol in a positive light. They have themselves muddied the waters. Michael Wang, from Argonne, (and author of the GREET model) made a remarkable claim last September at The 15th Annual Symposium on Alcohol Fuels in San Diego (5). On his 4th slide , he claimed that it takes 0.74 MMBTU to make 1 MMBTU of ethanol, but 1.23 MMBTU to make 1 MMBTU of gasoline. That simply can’t be correct, as the calculations in the preceding paragraphs have shown.

Not only is his claim incorrect, but it is terribly irresponsible for someone from a government agency to make such a claim. I don’t know whether he is being intentionally misleading, but it certainly looks that way. Wang is also the co-author of the earlier USDA studies that I have critiqued and shown to be full of errors and misleading arguments. These people are publishing articles that bypass the peer review process designed to ferret out these kinds of blatant errors. I suspect a politically driven agenda in which they are putting out intentionally misleading information.

One of the reasons I haven’t written this up already, is that 2 weeks ago I sent an e-mail to Wang bringing this error to his attention. I immediately got an auto-reply saying that he was out of the office until March 31st. I have given him a week to reply and explain himself, but he has not done so. Therefore, at this time I must conclude that he knows the calculation is in error, but does not wish to address it. In the interim, ethanol proponents everywhere are pushing this false information in an effort to boost support for ethanol.

Look at the Minnesota Department of Agriculture claim again: “the energy yield of ethanol is (1.34/0.74) or 81 percent greater than the comparable yield for gasoline”. If the energy balance was really this good for ethanol and that bad for gasoline, why would anyone ever make gasoline? Where would the economics be? Why would ethanol need subsidies to compete? It should be clear that the proponents in this case are promoting false information.

References

1. Ethanol versus Gasoline
2. BTU Content of Common Energy Units
3. Alternative energy: evaluating our options
4. Allocation of Energy Use in Petroleum Refineries to Petroleum Products
5. Updated Energy and Greenhouse Gas Emissions Results of Fuel Ethanol

April 8, 2006 Posted by | energy balance, ethanol, Michael Wang, USDA | 19 Comments

How Reliable are Those USDA Ethanol Studies?

Introduction

The pro-ethanol contingent is quick to point to certain studies published by the USDA to support the claim that the energy balance of grain-ethanol is positive. Many anti-ethanol advocates will point to studies by Professors Pimentel and Patzek (1) to support claims that the energy balance is negative. Say what you will about the Pimentel and Patzek studies, but they have one thing going for them that that USDA studies do not: They have been published in peer-reviewed journals. Why does this matter? Peer reviewed papers have been examined by reviewers familiar with the subject matter (but who are not colleagues of the authors) who are looking for deficiencies or gross errors. Peer review is no guarantee that errors won’t slip through, but it is a check on papers that establishes that they have met certain scholarly guidelines. Peer review can be a pretty rough ordeal, but does a pretty good job of weeding out poor arguments.

Now, having said that, I will acknowledge that some of the criticisms of the data that Pimentel used may be legitimate. So, the purpose here is not to defend Pimentel’s work, but instead to take a rigorous look at the USDA studies. In 2002, the pro-ethanol USDA released a paper by Shapouri, Duffield, and Wang in which they claimed that the energy balance of corn-ethanol was 1.34 (2). In other words, for every 1 BTU you input into the process, you got 1.34 BTUs back out. I analyzed these arguments in an earlier essay, and showed that proper accounting shows that the energy balance is actually 1.27 (using their assumptions, and as long as co-product credits are included) over an average of the 9-highest corn-producing states. Extrapolating this energy balance outside this area is inappropriate. Even within these 9 states, Nebraska, which must irrigate its corn, used substantially more BTUs to produce the corn. The energy balance for Nebraska – assuming for a moment that all of their other assumptions were correct – is 1.21 based on the data in the 2002 paper.

Incorrect Assumptions in the 2002 Report

However, all of their assumptions were not correct. In a 2004 update (3), they note that the estimate of the energy required to produce a pound of nitrogen fertilizer was much too low in the 2002 report. They reported 18,392 BTU/lb in their 2002 report. For the 2004 report, Shapouri consulted a fertilizer manufacturer, and was told that the actual number is about 24,500 BTU/lb. So, Shapouri underestimated this energy input by 25%.

In addition, they also acknowledged that they underestimated the amount of energy used to produce seed corn. They had estimated in 2002 that it took 1.5 times the amount of energy for normal corn, but actually found out that the true number is 4.7 times the amount of energy for normal corn. So, they underestimated this energy input by almost 70%.

They did not include any secondary energy inputs (such as the energy to actually produce an ethanol plant) in either their 2002 or 2004 paper, saying the data is “old and outdated”. So, here is an energy input that they simply ignored.

They report higher yields in the 2004 report (weighted avg. of 139.3 bushels per acre for in the 2004 report versus 121.9 in the 2002 report). However, some states saw very little change in their yields between the two reports. Nebraska, for example, increased from 130 bushels per acre to 133.7, a gain of less than 3%.

Analysis of the 2004 Report

Again, they only focused on the 9-highest corn producing states. Nebraska again provides a perfect example of how the energy balance tends to get much worse as you move away from the best corn-producing areas. The energy input for Nebraska is almost 20,000 BTU/bushel higher than for the 9-state weighted average, primarily due to their need to irrigate. So, their energy balance will be much worse than the average number that was ultimately calculated.

Overall, they lowered their estimate for the total energy input into the corn-growing process from 57,476 BTUs/bushel to 49,753 BTUs/bushel. However, Nebraska came in at almost 69,000 BTUs/bushel.

The most amazing thing, though, is that they reported an overall energy balance of corn ethanol of 1.67 in the 2004 report, versus 1.34 (their number) in the 2002 report. Why the huge change? Did the process improve by that much? No, they are just employing ever more sophisticated sleight of hand. What they did is to allocate the energy used in the process to by-products and ethanol separately. This is a valid way of accounting for the energy, if it is done correctly. However, they way they did it looks highly suspicious. It would be quite easy to over-allocate energy to the by-products (especially if one had an agenda), making the ethanol portion show less energy than it actually used. This appears to be exactly what they did.

In 2002, their calculation resulted in 81% of the energy allocation going to ethanol. In 2004, they only allocate 64% of the total energy to ethanol production (Tables 3 and 4), dramatically “improving” the energy balance. They have acknowledged that they changed their accounting methods from their 2002 report, now using an Aspen model to allocate energy. I have plenty of experience with Aspen models, and I can say that it is imperative that you validate your assumptions. If you do not – and I can see no indication that they did – it is nothing more than garbage-in, garbage-out.

Here is an example of how invalid assumptions can lead to an invalid answer. They calculated that the total energy cost for the ethanol conversion step was 49,733 BTUs/gallon, but then allocated almost 20,000 BTUs of that to the by-products! Hello? The only reason you do a distillation is to purify the ethanol. That step has to be completely allocated to ethanol. By allocating some of these inputs to by-products, the impression is left that it took less energy to purify the ethanol than it actually did.

What is stated explicitly is that, ignoring co-product credits, they have energy inputs of 72,052 BTUs to produce 76,375 BTUs of ethanol, for an EROI of 1.06. They are allocating credits based on an Aspen model which is not publicly available, so it is impossible to check their assumptions. I can say that based on the way they have allocated some of the conversion energy to the co-products, that they have made invalid assumptions.

But, we can take the co-product value they reported in 2002 and estimate a more valid EROI. In 2002 they estimated co-product value at 14,372 BTU/gallon of ethanol. If we add that to the BTUs of the ethanol they produced, we get (76,375 + 14,372) BTUs out, or 90,747 out. Given their input of 72,052 BTUs, then their EROI with co-products is 90,747/72,052, or 1.26. That is a terrible EROI, and is even worse than what they calculated in 2002. This is not entirely surprising given that they admit that they significantly underestimated certain inputs (and left secondary inputs completely out of the equation). The 1.67 number is a fantasy based on very selective accounting.

Summary

Given the selective accounting employed in the USDA papers (both 2002 and 2004), it is doubtful that it would have passed peer-review without substantial modification. While I have my reservations about the data used by Pimentel, the USDA work is very shoddy in comparison. It has all the ear-marks of an agency attempting to push a political agenda. Certain data were selectively omitted from the energy calculation. The reported EROI of 1.67, parroted by the pro-ethanol contingent, completely breaks down under close examination. It is simply inaccurate and irresponsible to claim this EROI given the factors examined in this essay.

References

1. Pimentel, D., and Tad Patzek (2005). Ethanol Production Using Corn, Switchgrass, and Wood; Biodiesel Production Using Soybean and Sunflower. Natural Resources Research 14, 1 (March): 65-76.

2. Shapouri, H., J.A. Duffield, and M. Wang. 2002. The Energy Balance of Corn Ethanol: An Update. AER-814. Washington, D.C.: USDA Office of the Chief Economist.

3. Shapouri, H., J.A. Duffield, and M. Wang. 2004. The 2001 Net Energy Balance of Corn Ethanol. Washington, D.C.: USDA Office of the Chief Economist.

March 31, 2006 Posted by | energy balance, ethanol, USDA | 14 Comments

How Reliable are Those USDA Ethanol Studies?

Introduction

The pro-ethanol contingent is quick to point to certain studies published by the USDA to support the claim that the energy balance of grain-ethanol is positive. Many anti-ethanol advocates will point to studies by Professors Pimentel and Patzek (1) to support claims that the energy balance is negative. Say what you will about the Pimentel and Patzek studies, but they have one thing going for them that that USDA studies do not: They have been published in peer-reviewed journals. Why does this matter? Peer reviewed papers have been examined by reviewers familiar with the subject matter (but who are not colleagues of the authors) who are looking for deficiencies or gross errors. Peer review is no guarantee that errors won’t slip through, but it is a check on papers that establishes that they have met certain scholarly guidelines. Peer review can be a pretty rough ordeal, but does a pretty good job of weeding out poor arguments.

Now, having said that, I will acknowledge that some of the criticisms of the data that Pimentel used may be legitimate. So, the purpose here is not to defend Pimentel’s work, but instead to take a rigorous look at the USDA studies. In 2002, the pro-ethanol USDA released a paper by Shapouri, Duffield, and Wang in which they claimed that the energy balance of corn-ethanol was 1.34 (2). In other words, for every 1 BTU you input into the process, you got 1.34 BTUs back out. I analyzed these arguments in an earlier essay, and showed that proper accounting shows that the energy balance is actually 1.27 (using their assumptions, and as long as co-product credits are included) over an average of the 9-highest corn-producing states. Extrapolating this energy balance outside this area is inappropriate. Even within these 9 states, Nebraska, which must irrigate its corn, used substantially more BTUs to produce the corn. The energy balance for Nebraska – assuming for a moment that all of their other assumptions were correct – is 1.21 based on the data in the 2002 paper.

Incorrect Assumptions in the 2002 Report

However, all of their assumptions were not correct. In a 2004 update (3), they note that the estimate of the energy required to produce a pound of nitrogen fertilizer was much too low in the 2002 report. They reported 18,392 BTU/lb in their 2002 report. For the 2004 report, Shapouri consulted a fertilizer manufacturer, and was told that the actual number is about 24,500 BTU/lb. So, Shapouri underestimated this energy input by 25%.

In addition, they also acknowledged that they underestimated the amount of energy used to produce seed corn. They had estimated in 2002 that it took 1.5 times the amount of energy for normal corn, but actually found out that the true number is 4.7 times the amount of energy for normal corn. So, they underestimated this energy input by almost 70%.

They did not include any secondary energy inputs (such as the energy to actually produce an ethanol plant) in either their 2002 or 2004 paper, saying the data is “old and outdated”. So, here is an energy input that they simply ignored.

They report higher yields in the 2004 report (weighted avg. of 139.3 bushels per acre for in the 2004 report versus 121.9 in the 2002 report). However, some states saw very little change in their yields between the two reports. Nebraska, for example, increased from 130 bushels per acre to 133.7, a gain of less than 3%.

Analysis of the 2004 Report

Again, they only focused on the 9-highest corn producing states. Nebraska again provides a perfect example of how the energy balance tends to get much worse as you move away from the best corn-producing areas. The energy input for Nebraska is almost 20,000 BTU/bushel higher than for the 9-state weighted average, primarily due to their need to irrigate. So, their energy balance will be much worse than the average number that was ultimately calculated.

Overall, they lowered their estimate for the total energy input into the corn-growing process from 57,476 BTUs/bushel to 49,753 BTUs/bushel. However, Nebraska came in at almost 69,000 BTUs/bushel.

The most amazing thing, though, is that they reported an overall energy balance of corn ethanol of 1.67 in the 2004 report, versus 1.34 (their number) in the 2002 report. Why the huge change? Did the process improve by that much? No, they are just employing ever more sophisticated sleight of hand. What they did is to allocate the energy used in the process to by-products and ethanol separately. This is a valid way of accounting for the energy, if it is done correctly. However, they way they did it looks highly suspicious. It would be quite easy to over-allocate energy to the by-products (especially if one had an agenda), making the ethanol portion show less energy than it actually used. This appears to be exactly what they did.

In 2002, their calculation resulted in 81% of the energy allocation going to ethanol. In 2004, they only allocate 64% of the total energy to ethanol production (Tables 3 and 4), dramatically “improving” the energy balance. They have acknowledged that they changed their accounting methods from their 2002 report, now using an Aspen model to allocate energy. I have plenty of experience with Aspen models, and I can say that it is imperative that you validate your assumptions. If you do not – and I can see no indication that they did – it is nothing more than garbage-in, garbage-out.

Here is an example of how invalid assumptions can lead to an invalid answer. They calculated that the total energy cost for the ethanol conversion step was 49,733 BTUs/gallon, but then allocated almost 20,000 BTUs of that to the by-products! Hello? The only reason you do a distillation is to purify the ethanol. That step has to be completely allocated to ethanol. By allocating some of these inputs to by-products, the impression is left that it took less energy to purify the ethanol than it actually did.

What is stated explicitly is that, ignoring co-product credits, they have energy inputs of 72,052 BTUs to produce 76,375 BTUs of ethanol, for an EROI of 1.06. They are allocating credits based on an Aspen model which is not publicly available, so it is impossible to check their assumptions. I can say that based on the way they have allocated some of the conversion energy to the co-products, that they have made invalid assumptions.

But, we can take the co-product value they reported in 2002 and estimate a more valid EROI. In 2002 they estimated co-product value at 14,372 BTU/gallon of ethanol. If we add that to the BTUs of the ethanol they produced, we get (76,375 + 14,372) BTUs out, or 90,747 out. Given their input of 72,052 BTUs, then their EROI with co-products is 90,747/72,052, or 1.26. That is a terrible EROI, and is even worse than what they calculated in 2002. This is not entirely surprising given that they admit that they significantly underestimated certain inputs (and left secondary inputs completely out of the equation). The 1.67 number is a fantasy based on very selective accounting.

Summary

Given the selective accounting employed in the USDA papers (both 2002 and 2004), it is doubtful that it would have passed peer-review without substantial modification. While I have my reservations about the data used by Pimentel, the USDA work is very shoddy in comparison. It has all the ear-marks of an agency attempting to push a political agenda. Certain data were selectively omitted from the energy calculation. The reported EROI of 1.67, parroted by the pro-ethanol contingent, completely breaks down under close examination. It is simply inaccurate and irresponsible to claim this EROI given the factors examined in this essay.

References

1. Pimentel, D., and Tad Patzek (2005). Ethanol Production Using Corn, Switchgrass, and Wood; Biodiesel Production Using Soybean and Sunflower. Natural Resources Research 14, 1 (March): 65-76.

2. Shapouri, H., J.A. Duffield, and M. Wang. 2002. The Energy Balance of Corn Ethanol: An Update. AER-814. Washington, D.C.: USDA Office of the Chief Economist.

3. Shapouri, H., J.A. Duffield, and M. Wang. 2004. The 2001 Net Energy Balance of Corn Ethanol. Washington, D.C.: USDA Office of the Chief Economist.

March 31, 2006 Posted by | energy balance, ethanol, USDA | 8 Comments

Grain-Derived Ethanol: The Emperor’s New Clothes

Energy security. Homegrown fuels. Better markets for our farmers. And by gosh, it’s good for the environment. Sounds good, doesn’t it? Where do I sign up?

However, the truth behind grain-derived ethanol is masked behind half-truths and myths promoted by a very powerful lobby on behalf of agricultural and ethanol interests. This is one of the biggest scams in operation today, enabled by politicians who fear the political power of that powerful lobby. I will dissect some of the claims in this essay, and show why grain-based ethanol is a huge misallocation of resources.

First, what do I know about ethanol? I grew up on a farm, and my family still farms. I wanted to help farmers and the environment, so I went to a graduate school where I could be a part of a research project that was doing just that. My research group in graduate school was working on the conversion of biomass (aka cellulose) into ethanol. Biomass conversion via microorganisms was the topic of my thesis. After graduation, I worked several years for a chemical company in various roles (R&D, process, production) supporting propanol and butanol production. I currently work for a major oil company, and I try to stay current on developments in the alternative energy fields. In 2005, my company sent me to the state legislature to provide expert testimony regarding a proposed ethanol mandate for my state. My testimony generated a lot of discussion, and I was called back to the stand ten times to answer questions. Despite some very contentious questioning, nobody rebutted the arguments that I made, which is the gist of this essay.

There is a pretty good consensus that oil production will peak in the next 10-20 years. Some are suggesting that it has already happened. I share the view that an oil peak is on the horizon, and I believe that it is critical for our very way of life to prepare for the imminent changes ahead. It is clear that sooner or later we will need to develop sustainable alternative fuel sources for transportation. However, grain-based ethanol production is not sustainable in the long-term.

A lot has been written about the energy balance of grain ethanol. Clearly, to be renewable, the Energy Return on Energy Invested (EROI) must be greater than 1.0. Pimentel at Cornell and Patzek at Berkley have argued that there is actually a net loss of energy when producing ethanol (as well as some other biofuels) (1). I do not share this view, although there is enough uncertainty in the data that there is a possibility that the EROI for grain ethanol is less than 1.0. However, in order to make my point, I am going to use the data from a 2002 USDA study by Shapouri et al. entitled “The Energy Balance of Corn Ethanol: An Update”(2). To be certain, Shapouri is an advocate of grain ethanol. In his report, Shapouri argues that when a BTU credit is taken for co-products like animal feed, the EROI is 1.34. In other words, for 1 BTU of energy invested, the total BTU value out was 1.34 BTUs if co-products were included.

At this point, it is important to point out a bit of accounting sleight of hand utilized by Shapouri, as well as a number of others when calculating EROI for ethanol. Note that the actual energy inputs into the process according to him are 77,228 BTU per gallon of ethanol produced (using the higher heating value, or HHV). The BTU value given for a gallon of ethanol (HHV) was 83,961. Therefore, excluding co-product credits, the EROI would appear to be 83,961/77,228, or 1.09. He includes a co-product credit of 14,372 BTU, which should raise the overall value of the BTU products to (83,961 + 14,372), or 98,333 BTUs. This would imply an EROI of 98,333/77,228, or 1.27. However, Shapouri, like many ethanol advocates, performs a completely illegitimate accounting trick to exaggerate the EROI of ethanol. He uses the 14,372 co-product credit to reduce the energy input of 77,228 and assumes an energy input of just 62,856 BTUs/gallon. Since the co-products are not actually used as inputs in the process, this is invalid. But that is not the most serious issue. When he uses the co-product credit to offset the energy input, it should be removed from the product side. Shapouri includes it on both sides of the equation – reduce the inputs with the co-product credit, and increase the BTU output with the co-product credit.

Consider this analogy. I invest $100, and I get a return of $20 and another $40 worth of goods (co-product). What is my return on investment (ROI)? Most people would say that I got a total return of $60 on an investment of $100, for an ROI of 60%. If we utilize Shapouri-style accounting, we would use the $40 co-credit to offset our initial investment. We would then argue that we only invested $60 to get a return of $60, for an ROI of 100%. So, the answer to the question – “When does a $60 return on a $100 investment amount to a 100% return on investment?” – is “Whenever the USDA is doing the accounting.”

To give another example of why this accounting practice is invalid, consider a case in which we invested 100 BTUs of energy, and got in return 100 BTUs of animal feed and 1 BTU of usable energy. What is the EROI? Using Shapouri-style accounting, the EROI is infinite, since the 100 BTUs of co-product completely offset our initial investment. We invested nothing, and got 1 BTU in return! Clearly this is not a valid way of accounting for our energy balance, but this practice is common in ethanol accounting.

So, we have an exaggerated EROI in the case of ethanol, but what’s the bottom line? Energy is being created, right? Isn’t that what we are after?

Yes, we are after energy creation (indirectly via capture of solar energy). However, the EROI must be very good, or the price we pay for this energy creation will be much too high. At present there is a federal subsidy on ethanol that amounts to $0.51/gallon. Let’s consider what we are getting for the subsidy. A gallon of gasoline contains 125,000 BTUs (same HHV basis as ethanol). In the Shapouri paper, the net gain reported in producing a gallon of ethanol was 21,000 BTUs. This means that we have to produce 125,000/21,000, or 5.95 gallons of ethanol before we have generated the energy contained in 1 gallon of gasoline. Given a federal subsidy of $0.51 a gallon, we have spent 5.95*$0.51, or $3.03 subsidizing replacement of 1 gallon of gasoline! This amounts to $24.29 of federal subsidy for every million BTUs (MMBTU) of energy created. Contrast this with a natural gas price of $7.00 per MMBTU. That doesn’t even factor in various state subsidies which push the overall subsidy up to over $4.00 per gallon of gasoline displaced. So, taxpayers pay this, but then they still have to buy the ethanol. Any way you slice it, this looks like a bad deal to me.

I questioned Shapouri about this in an e-mail. I wrote that the subsidies appeared to be way out of line, considering that the subsidy on wind power was about $5/MMBTU. In his response, he made no attempt at all to rationalize or defend these subsidies. He wrote If we want to produce fuel ethanol from biomass and crop residues, then ethanol should compete with gasoline on the BTU bases. We do not have the technology yet. But in the future it is a possibility. His conclusion is the same one I came to in graduate school in the 90’s: Someday the technology may be economical for biomass, but grain-based ethanol is not even in the ballpark.

Also note that Shapouri’s paper examined the energy balances for the 9 highest corn producing states. He used a weighted average for the states (Table 4 in his report) and concluded that on average it takes 57,476 BTU to produce a bushel of corn. It is this average on which his EROI is based. However in states like Nebraska, where corn must be irrigated, they concluded that it takes 68,120 BTUs to produce a bushel of corn. In other words, the energy balance for some states is far less favorable than others, and may be negative in some cases (even using Shapouri’s methodology).

What of the claims from the pro-ethanol literature such as: Ethanol production is extremely energy efficient, with a positive energy balance of 125%, compared to 85% for gasoline (3). If these claims were true, then would they actually need ethanol subsidies? Ethanol could put oil companies out of business if this claim had merit.

In fact, however, such claims are false. These claims are based on the use of two different accounting methods designed to show ethanol in a positive light. The energy balance for ethanol is calculated for the entire life cycle, and that for gasoline is calculated on the basis of a barrel of crude oil ready to be refined. We can calculate gasoline based on an entire life cycle to obtain a true apples to apples comparison. It takes only about 1 barrel of oil energy input to net 10-30 barrels of oil from the ground, depending on the source. So, this step has an efficiency of at least 1000%. Once the 85% energy efficiency is factored in for refining gasoline from the oil, the positive energy balance for gasoline ranges from 850% to well over 1,000%. That’s why gasoline costs significantly less than ethanol on a BTU basis. The claim that gasoline is less efficient is just another piece of propaganda used to make the public believe ethanol is better than it is. It would be interesting to see a closed-loop ethanol plant, in which the ethanol they produce provides the energy for the plant. It would not take long for the charade to fall apart, as it would become apparent just how dependent they are on fossil fuels.

I have not even addressed the environmental impacts of growing corn to produce fuel. This is usually given a “free pass” when considering the economics of corn ethanol. Consider a recent report by Lester Lave and Michael Griffin, from Carnegie Mellon University. They write:

Corn farming is rough on the environment. Soil erosion due to wind and water is rampant. Fertilizer and pesticide runoffs produce algae blooms that result in “dead zones,” including one in the Gulf of Mexico that is so polluted it cannot support aquatic life. Furthermore, building the ethanol processing plants will take 3–4 years, and gas stations would have to commit to providing ethanol. And, because ethanol uses only the starch in corn, not the oil, protein, or other components, converting corn into ethanol is attractive only if there is a market for the byproducts. Opinions differ, but some estimate that byproduct markets could saturate well short of 11 billion gallons of production.

So, we have a marginal energy balance, subsidies that are far out of line with what we are getting for the money, and we are damaging the environment in the process. This idea sounds like something hatched by politicians and kept alive by lobbyists with deep pockets. Which is, in fact, the truth of the matter.

This was the gist of my testimony at the state legislature in 2005. I made an offer to the representatives, as well as to the ethanol proponents and general members of the audience. I told them that I would hang around and answer every single question or criticism they had about my testimony. That was quite interesting. I was cursed by one of the sponsors of the bill. I was accused of protecting the interests of “Big Oil”. I was blamed for the war in Iraq (despite the fact that my state gets all of our imports from Canada). Lots of people told me that I had my facts wrong, but every one of them backed down when I asked for specifics. Nobody rebutted my argument.

References

1. Pimentel, David. The Limits of Biomass Energy. Encyclopedia of Physical Sciences and Technology, September 2001.

2. Shapouri, H., J.A. Duffield, and M. Wang. 2002. “The Energy Balance of Corn Ethanol: An Update”. AER-814. Washington, D.C.: USDA Office of the Chief Economist.

3. This claim seems to have originated with the American Coalition for Ethanol, but can be found on a number of the ethanol advocates’ information sheets. It is also promoted by Argonne National Laboratory through their misleading GREET model.

4. The Green Bullet

March 23, 2006 Posted by | energy balance, ethanol, USDA | 22 Comments

Grain-Derived Ethanol: The Emperor’s New Clothes

Energy security. Homegrown fuels. Better markets for our farmers. And by gosh, it’s good for the environment. Sounds good, doesn’t it? Where do I sign up?

However, the truth behind grain-derived ethanol is masked behind half-truths and myths promoted by a very powerful lobby on behalf of agricultural and ethanol interests. This is one of the biggest scams in operation today, enabled by politicians who fear the political power of that powerful lobby. I will dissect some of the claims in this essay, and show why grain-based ethanol is a huge misallocation of resources.

First, what do I know about ethanol? I grew up on a farm, and my family still farms. I wanted to help farmers and the environment, so I went to a graduate school where I could be a part of a research project that was doing just that. My research group in graduate school was working on the conversion of biomass (aka cellulose) into ethanol. Biomass conversion via microorganisms was the topic of my thesis. After graduation, I worked several years for a chemical company in various roles (R&D, process, production) supporting propanol and butanol production. I currently work for a major oil company, and I try to stay current on developments in the alternative energy fields. In 2005, my company sent me to the state legislature to provide expert testimony regarding a proposed ethanol mandate for my state. My testimony generated a lot of discussion, and I was called back to the stand ten times to answer questions. Despite some very contentious questioning, nobody rebutted the arguments that I made, which is the gist of this essay.

There is a pretty good consensus that oil production will peak in the next 10-20 years. Some are suggesting that it has already happened. I share the view that an oil peak is on the horizon, and I believe that it is critical for our very way of life to prepare for the imminent changes ahead. It is clear that sooner or later we will need to develop sustainable alternative fuel sources for transportation. However, grain-based ethanol production is not sustainable in the long-term.

A lot has been written about the energy balance of grain ethanol. Clearly, to be renewable, the Energy Return on Energy Invested (EROI) must be greater than 1.0. Pimentel at Cornell and Patzek at Berkley have argued that there is actually a net loss of energy when producing ethanol (as well as some other biofuels) (1). I do not share this view, although there is enough uncertainty in the data that there is a possibility that the EROI for grain ethanol is less than 1.0. However, in order to make my point, I am going to use the data from a 2002 USDA study by Shapouri et al. entitled “The Energy Balance of Corn Ethanol: An Update”(2). To be certain, Shapouri is an advocate of grain ethanol. In his report, Shapouri argues that when a BTU credit is taken for co-products like animal feed, the EROI is 1.34. In other words, for 1 BTU of energy invested, the total BTU value out was 1.34 BTUs if co-products were included.

At this point, it is important to point out a bit of accounting sleight of hand utilized by Shapouri, as well as a number of others when calculating EROI for ethanol. Note that the actual energy inputs into the process according to him are 77,228 BTU per gallon of ethanol produced (using the higher heating value, or HHV). The BTU value given for a gallon of ethanol (HHV) was 83,961. Therefore, excluding co-product credits, the EROI would appear to be 83,961/77,228, or 1.09. He includes a co-product credit of 14,372 BTU, which should raise the overall value of the BTU products to (83,961 + 14,372), or 98,333 BTUs. This would imply an EROI of 98,333/77,228, or 1.27. However, Shapouri, like many ethanol advocates, performs a completely illegitimate accounting trick to exaggerate the EROI of ethanol. He uses the 14,372 co-product credit to reduce the energy input of 77,228 and assumes an energy input of just 62,856 BTUs/gallon. Since the co-products are not actually used as inputs in the process, this is invalid. But that is not the most serious issue. When he uses the co-product credit to offset the energy input, it should be removed from the product side. Shapouri includes it on both sides of the equation – reduce the inputs with the co-product credit, and increase the BTU output with the co-product credit.

Consider this analogy. I invest $100, and I get a return of $20 and another $40 worth of goods (co-product). What is my return on investment (ROI)? Most people would say that I got a total return of $60 on an investment of $100, for an ROI of 60%. If we utilize Shapouri-style accounting, we would use the $40 co-credit to offset our initial investment. We would then argue that we only invested $60 to get a return of $60, for an ROI of 100%. So, the answer to the question – “When does a $60 return on a $100 investment amount to a 100% return on investment?” – is “Whenever the USDA is doing the accounting.”

To give another example of why this accounting practice is invalid, consider a case in which we invested 100 BTUs of energy, and got in return 100 BTUs of animal feed and 1 BTU of usable energy. What is the EROI? Using Shapouri-style accounting, the EROI is infinite, since the 100 BTUs of co-product completely offset our initial investment. We invested nothing, and got 1 BTU in return! Clearly this is not a valid way of accounting for our energy balance, but this practice is common in ethanol accounting.

So, we have an exaggerated EROI in the case of ethanol, but what’s the bottom line? Energy is being created, right? Isn’t that what we are after?

Yes, we are after energy creation (indirectly via capture of solar energy). However, the EROI must be very good, or the price we pay for this energy creation will be much too high. At present there is a federal subsidy on ethanol that amounts to $0.51/gallon. Let’s consider what we are getting for the subsidy. A gallon of gasoline contains 125,000 BTUs (same HHV basis as ethanol). In the Shapouri paper, the net gain reported in producing a gallon of ethanol was 21,000 BTUs. This means that we have to produce 125,000/21,000, or 5.95 gallons of ethanol before we have generated the energy contained in 1 gallon of gasoline. Given a federal subsidy of $0.51 a gallon, we have spent 5.95*$0.51, or $3.03 subsidizing replacement of 1 gallon of gasoline! This amounts to $24.29 of federal subsidy for every million BTUs (MMBTU) of energy created. Contrast this with a natural gas price of $7.00 per MMBTU. That doesn’t even factor in various state subsidies which push the overall subsidy up to over $4.00 per gallon of gasoline displaced. So, taxpayers pay this, but then they still have to buy the ethanol. Any way you slice it, this looks like a bad deal to me.

I questioned Shapouri about this in an e-mail. I wrote that the subsidies appeared to be way out of line, considering that the subsidy on wind power was about $5/MMBTU. In his response, he made no attempt at all to rationalize or defend these subsidies. He wrote If we want to produce fuel ethanol from biomass and crop residues, then ethanol should compete with gasoline on the BTU bases. We do not have the technology yet. But in the future it is a possibility. His conclusion is the same one I came to in graduate school in the 90’s: Someday the technology may be economical for biomass, but grain-based ethanol is not even in the ballpark.

Also note that Shapouri’s paper examined the energy balances for the 9 highest corn producing states. He used a weighted average for the states (Table 4 in his report) and concluded that on average it takes 57,476 BTU to produce a bushel of corn. It is this average on which his EROI is based. However in states like Nebraska, where corn must be irrigated, they concluded that it takes 68,120 BTUs to produce a bushel of corn. In other words, the energy balance for some states is far less favorable than others, and may be negative in some cases (even using Shapouri’s methodology).

What of the claims from the pro-ethanol literature such as: Ethanol production is extremely energy efficient, with a positive energy balance of 125%, compared to 85% for gasoline (3). If these claims were true, then would they actually need ethanol subsidies? Ethanol could put oil companies out of business if this claim had merit.

In fact, however, such claims are false. These claims are based on the use of two different accounting methods designed to show ethanol in a positive light. The energy balance for ethanol is calculated for the entire life cycle, and that for gasoline is calculated on the basis of a barrel of crude oil ready to be refined. We can calculate gasoline based on an entire life cycle to obtain a true apples to apples comparison. It takes only about 1 barrel of oil energy input to net 10-30 barrels of oil from the ground, depending on the source. So, this step has an efficiency of at least 1000%. Once the 85% energy efficiency is factored in for refining gasoline from the oil, the positive energy balance for gasoline ranges from 850% to well over 1,000%. That’s why gasoline costs significantly less than ethanol on a BTU basis. The claim that gasoline is less efficient is just another piece of propaganda used to make the public believe ethanol is better than it is. It would be interesting to see a closed-loop ethanol plant, in which the ethanol they produce provides the energy for the plant. It would not take long for the charade to fall apart, as it would become apparent just how dependent they are on fossil fuels.

I have not even addressed the environmental impacts of growing corn to produce fuel. This is usually given a “free pass” when considering the economics of corn ethanol. Consider a recent report by Lester Lave and Michael Griffin, from Carnegie Mellon University. They write:

Corn farming is rough on the environment. Soil erosion due to wind and water is rampant. Fertilizer and pesticide runoffs produce algae blooms that result in “dead zones,” including one in the Gulf of Mexico that is so polluted it cannot support aquatic life. Furthermore, building the ethanol processing plants will take 3–4 years, and gas stations would have to commit to providing ethanol. And, because ethanol uses only the starch in corn, not the oil, protein, or other components, converting corn into ethanol is attractive only if there is a market for the byproducts. Opinions differ, but some estimate that byproduct markets could saturate well short of 11 billion gallons of production.

So, we have a marginal energy balance, subsidies that are far out of line with what we are getting for the money, and we are damaging the environment in the process. This idea sounds like something hatched by politicians and kept alive by lobbyists with deep pockets. Which is, in fact, the truth of the matter.

This was the gist of my testimony at the state legislature in 2005. I made an offer to the representatives, as well as to the ethanol proponents and general members of the audience. I told them that I would hang around and answer every single question or criticism they had about my testimony. That was quite interesting. I was cursed by one of the sponsors of the bill. I was accused of protecting the interests of “Big Oil”. I was blamed for the war in Iraq (despite the fact that my state gets all of our imports from Canada). Lots of people told me that I had my facts wrong, but every one of them backed down when I asked for specifics. Nobody rebutted my argument.

References

1. Pimentel, David. The Limits of Biomass Energy. Encyclopedia of Physical Sciences and Technology, September 2001.

2. Shapouri, H., J.A. Duffield, and M. Wang. 2002. “The Energy Balance of Corn Ethanol: An Update”. AER-814. Washington, D.C.: USDA Office of the Chief Economist.

3. This claim seems to have originated with the American Coalition for Ethanol, but can be found on a number of the ethanol advocates’ information sheets. It is also promoted by Argonne National Laboratory through their misleading GREET model.

4. The Green Bullet

March 23, 2006 Posted by | energy balance, ethanol, USDA | 10 Comments