http://blogs.consumerreports.org/cars/2008/03/ethanol-e85.html

“But there are some problems with increasing ethanol blends. Ethanol contains less energy than gasoline, so increasing the amount of ethanol in gasoline will likely result in lower fuel economy. Increasing standard fuel blends from zero to 10 percent ethanol, as is happening today, has little or no impact on fuel economy. In tests, the differences occur within the margin of error, about 0.5 percent. Further increasing ethanol levels to 20 percent reduces fuel economy between 1 and 3 percent, according to testing by the DOE and General Motors. Evaluations are underway to determine if E20 will burn effectively in today’s engines without impacting reliability and longevity, and also assessing potential impact on fuel economy.”

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For an exhaustive discussion of the various subsidies supporting biofuels in the United States, see the two reports (2006 and the 2007 update) done for the Global Subsidies Initiative, which can be downloaded for free here.

John Mashey seems to be concerned about the high price of diesel fuel in Iowa. The price of diesel fuel is high everywhere. (Anybody who uses diesel fuel — independent truckers, homeowners with oil heat, are suffering as well.)

But despite the high prices, esterfying vegetable oils into biodiesel is a value-SUBTRACTING business. That is to say, the value per gallon of the biodiesel is less than the value of the inputs (vegetable oil, methanol and catalyst) that go into making it. The only reason there is any biodiesel industry left operating in the country is because of the generous federal tax credit ($1.00 per gallon), the reductions and exemptions from state fuel taxes that biodiesel enjoys in many states, and the fact that some producers can engage in “splash and dash” — adding 1% gasoline to biodiesel, earning the $1.00 per gallon tax credit, and then shipping the “B99″ mix to Europe, where fuel taxes are far higher than in the United States, and therefore tax-exempt biodiesel commands a higher price.

John Mashey — In this region farmers who used to grow hops (for the regional beer brewers) have switched to growing corn. The microbreweries state that many of them will have to close their doors.

I prefer the principle (which seems quite similar to Biopact’s stance) that land suitable for food ought ONLY to be subsidized to grow food (includes animal feed), or else be registered in a set-aside program. There are planty of other sources of biomass to produce bioenergy. Done properly, there is no need for subsidies, although government sponored research continues to be a good idea. This appears to be the developing EU stance and the Europeans subsidize farmers more than in the US.

(a) Farmers grow (corn, wheat…) at least in part due to subsidies.

(b) Elevator operators buy the corn, with the usual jiggling around sa farmers may hold back crops for a while if they think the price well go up. Once the corn is there, the farmer doesn’t say what its usage is.

(c) Various buyers by the corn from (b), and either ship it somewhere else, or process it into (HFCS, etc), or feed it to animals, and ship the meat.

Farmer co-ops may integrate into (b) and maybe (c) to capture more of the value-add; companies like ADM or Cargill integrate from (c) back into (b) and ownership of (a) sometimes, for the same reason.

Anyway, there are some fairly complex value chains, and in a lot of cases, taxpayers aren’t paying the farmers to grow corn for ethanol, they’re paying somebody like ADM… Anyway, to do anything sensible, one really needs to understand the chain, who makes money where, who makes which decisions, etc.

But, I do have to ask: given the *actual* usage of corn, i.e., mostly for meat, but substantially for HFCS and other “foodlike substances”, there is room for argument about the best usage of an acre of corn. Do you *want* to maintain the level of HFCS in the US diet? Do we really need as many CAFOs as we have? There are plenty of reasons not to like corn ethanol, but I need deeper discussions than just “corn ethanol raises the prices of food”, because I think the goodness of the food system driven by corn has room for legitimate debate. When I grew up on a farm, we kept some land as forest, to be cut as firewood, even though we could have grown corn on that land.

Let me try another question:

If at some point, the price of diesel fuel gets high enough that somebody goes out of business, but they could divert enough of their acreage to provide enough biofuel to farm the rest, is that OK, or is that not allowed?
[Or equivalent.]

In any case, I doubt that the current level of corn-growing is sustainable, no matter what. Nitrogen fertilizer prices are rising [natural gas], and a lot of places are going to have water pressure, i.e., maybe not rainfed Iowa, but Ogallala-aquifer-fed areas are going to get more difficult. In the long term, IF there actually going to be US-based ethanol, it won’t be corn, it will be lower-water/fertilizer switchgrass/miscanthus variants grown more for electricity generation, but with some fuel output. We never fertilize our bamboo, and we don’t get a lot of rainfall, and that &$&%^% stuff (planted by fomer owner) still grows like a weed, and the rhizomes are really tough to get rid of.

http://biopact.com/

for over a year now, and more recently also

http://www.icis.com/blogs/biofuels/

As you know, food crops are highly subsidized in the United States, in Europe and maybe elsewhere. Farmers who want their handout have to follow the rules. They can simply strike out on their own, but I know of none (other than illegal mary-jane growers) who do. So the government, through the Food and Farm Bill, largely controls who grows what on which lands. For example, the set-aside payments are so large than no farmer around here has done anything but set aside as much land as he is entitled to. (This may change this spring, given the extraordinary price of wheat.)

In India, it used to be illegal to make ethanol from refined sugar, only the molasses byproduct of the refining could be used for ethanol. This law has recently been changed, largely because of the world-wide sugar glut.

In the United States (less so in Europe) farmers can indeed grow what they want (except industrial or mary-jane hemp), but it costs them significant support if they don’t follow the (rather liberal) rules. And around here, no USDA employee has ever been so much as chased off land, much less shot, not ever.

US farmers are only keen on corn-for-ethanol because the federal govenment heavily subsidizes this activity, despite its very poor EOEI of about 1.05 or so. Without this support, and especially removing the punative import tax on ethanol (from Brazil), even at current diesel, etc., prices few or no farmers would grow it. The federal program is a boondoggle in which taxpayers pay farmers to grow corn-for-ethanol and watch the prices of foor go up as a result. Bad, bad plan.

[Note: I'm personally hoping, in order, for:
algae biodiesel
jatropha
switchgrass and/or miscanthus
or variants thereof. Corn, especially was never designed as a fuel plant.

Note that if corn is being grown for fuel, and something like switchgrass has higher yield/cost ratios, they'll switch.]

Still:

a) You say that there is a glut of sugar on the market, and hence it’s better to use sugarcane for fuel. Do you not believe there is or at least has been a general glut of corn on the market, to the extent it’s in an awful lot of the food we eat, probably to our detriment? [Have you read The Omnivore's Dilemma, for example?] Are you really happy with HFCS usage? Does it have anything to do with obesity and diabetes, I wonder?

b) To you propose to outlaw ethanol factories? Or tax ethanol higher than gasoline to eliminate ethanol? [It's pretty hard to just to outlaw corn, given it's a widely-used commodity.]

c) If it’s OK to grow fuel crops on marginal or setaside land, where’s the boundary, and is it illegal for a farmer to plant switchgrass (for example) on land that isn’t quite so marginal? Will someone inspect every farmer’s land and arrest them if switchgrass is found in not-so-marginal land? [After all, there are illegal crops, like marijauna, but it's illegal wherever it's grown, not legal in one part of a field and legal in another.]

d) Should we further mandate what farmers are and are not allowed to grow on their land [there are many non-optimal crops] and where on “their” land?

For example, we haven’t yet managed to outlaw tobacco-growing, have we? Should we? http://www.greenlivingtips.com/ articles/ 190/ 1/ Tobaccos-environmental-impact.html

Says of tobacco-growing:
#
# Nearly 600 million trees of forest are destroyed each year to provide wood to dry tobacco.
# in Tanzania, an estimated 65 pounds of wood is needed to dry a pound of tobacco
# In countries where wood isn’t used, LPG, coal or oil is used for drying
# by 2010, 87 percent of the world’s tobacco will be grown in the developing world.
# A modern cigarette manufacturing machine can use up to 3.7 miles of paper an hour
# Tobacco plants use more nutrients than many other crops, degrading the soil.
# Vast quantities of pesticides, fertilizer and herbicides are used on tobacco crops. Some crops requires over a dozen applications of pesticides during the three-month growing period.
Great stuff tobacco, and *so* useful compared to corn ethanol, and it occupies prime farmland.
====

BUT, farmers should not be allowed to grow fuel crops as they choose, even if they could do so cost-competitively, without subsidies, when petroleum gets too expensive to buy to run their gear??

I think that at least one of the reasons that the farmers are keen on ethanol is that they can grow something whose price tracks petroleum, thus hedging their cost exposure.

Come to think of it, there are lawns, of which we have 21M acres of private lawns. [That's about the acreage devoted to ethanol.] Should we mandate that those lawns be turned into gardens, or planted with something that uses less water and fertilizer than existing lawns? Why not?

Last questions: how much time have you spent on farms, and where, and what sort? [That will help guid my next round of comments.]

Again, none of this is “I love corn ethanol” because I don’t … but I must say that farmers are notoriously independent, and often own guns, and I would not want to be the inspector who comes to tell them what they can grow on each acre The issue is: if we want to create good overall policies:

a) We have to understand (for example) the woeldview from Ioawa and from an individual Iowa corn famer.

b) We have to have policies and laws that make sense, go in in the right direction, encourage the “Right things”, and work below the “Everyone should be good” level of detail, because the devil is in the details. If we can’t outlaw tobacco growing, the chances of outlawing corn ethanol seem pretty low.

I, however, have no objection to, indeed encourage, growing biomass for bioenergy on set-aside lands, or areas too infertile for producing food (human or fiber) or fiber. Jatropha on semi-desert soils comes to mind.

Nor have I the slightest objection to using sugarcane to produce ethanol. There is a glut of sugar on the world markets. The oversupply ought to be, and is being, turned to more economic uses.

I am, to make it completely clear, absolutely opposed to ethanol-from-corn. Probably the same for biodiesel-from-rapeseed.

Not sure what your point is JB. Are you saying the vast majority of the scientific community is hysterical and insane?