Is the Ethanol Mandate Likely to be Repealed? 57 comments
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In 2005, Congress approved the Energy Policy Act that mandates the use of ethanol in gasoline. The level was 4.7 billion gallons of ethanol for 2007. This will rise to 7.5 billion gallons in 2012. In fact, President Bush was pressing for an extension of this mandate to 35 billion gallons of ethanol by 2017.
At first people thought this was a great idea for something to replace MTBE, or even just substitute in some way for regular gasoline. However, several problems have arisen since then. First, this is an incredibly inefficient way to produce a gasoline substitute. It is estimated that the diesel fuel needed to run the harvesters, the transportation equipment, etc. amounts to approximately one half of the total volume of ethanol produced. These harvesters are also producing smog, so we're not really saving there either. If you then consider that one gallon of ethanol has only about two thirds of the energy content of 1 gallon of gasoline (i.e. your gas mileage will be lower per gallon with more ethanol in the gas mix), the actual benefit of ethanol as an oil substitute is minimal (1 – 1/2 – 2/3 * 1/2 = 1/6). Add to this all of the other costs associated with ethanol production such as labor, etc. and you are really just digging a hole for yourself.
Furthermore, scientists have discovered that ethanol actually led to more smog emissions rather than less (approximately 65% greater than gasoline with MTBE and 45% greater than plain gasoline). The study indicated that the ethanol actually caused a 1-2% increase in the overall smog levels in areas tested in California. This is especially true in hot weather. This is why California has an ethanol waiver for the summer months. Thank you Senator Feinstein. Further, the government is subsidizing ethanol production; and the use of agricultural products (mainly corn in the U.S.) to manufacture ethanol is contributing to the rise in grain prices (food in general).
In sum, the ethanol idea looks like a very bad one. Still, is it likely to be repealed? I have not heard a groundswell that makes me think it will be in the near future. The farmers like it. They make money on the bigger corn crops they produce. Plus, they make more money because the high price of gasoline is driving the partial gasoline substitute price up. This is driving grain prices in general up. This food price increase is causing some people to take a negative notice of ethanol.
The flame caused by this is being doused somewhat by others who are claiming that cellulosic ethanol (made from wood chips, etc.) will be the future answer to all of this. On the contra side, it is unclear that the technology for cellulosic ethanol fully exists at this time. To base an energy strategy on this seems questionable at best. Yet the US may be doing this.
Again will the ethanol mandate be repealed? I don't see it happening in the near future. The trade deficit due to oil importation is so great at the moment that anything which will give even the illusion of lessening this load is not likely to go away in the current market. Plus, the farmers, the fertilizer and seed suppliers, the farm equipment makers, and the ethanol producers/refiners would strenuously object. They would all be hurt by a repeal. Their Congressional representatives would think twice (or more) before repealing this law. In general members of Congress would think twice before doing something that would cause a certain downturn in another sector of the US economy in a recessionary time.
The real problem after all is the oil trade deficit and the high price of oil. Is a repeal likely? No, I don't think so in the short term. It seems more likely that the Congress will let this law ride for the moment. This likely means it will exist until at least 2012. No one ever wants to publicly embarrass themselves by admitting they were wrong. Congressional members (and the President) are no different. Even if Obama is elected, he is from Illinois, which is a farm state. Need I say more?
What does this mean for the markets? It likely means that the Ag stocks, the Ag equipment maker stocks, the ethanol stocks such as ADM will all likely continue to boom. Cramer (not on TV but on a Web site) has been suggesting you buy distant calls on Ag stocks. Then he says you can sell these stocks short on rallies with the safety of knowing you have the calls to insure you against too much upside risk. He is suggesting you do this because an ethanol mandate repeal would be a disaster for Ag (have an immediate negative effect on Ag stock prices).
I have tried to present a non-biased picture of the ethanol situation. To me it looks like ethanol is effectively a waste of time, effort, and money (our taxes are subsidizing ethanol production in the US). Still, there is some promise to the idea of cellulosic ethanol. I can't see a repeal of the ethanol mandate in the near future. The economic consequences for immediate action are too high. A repeal is something that should be well thought out. It should be announced well in advance. Since I have heard very little news of this, I must conclude that it is not imminent.
Rather, I am thinking brokerage houses (perhaps GS and PJ again) are trying to manipulate the markets in Ag stocks. They can make good money if they can move the markets in the direction they are attempting to. They make money as the stocks go down. Then they make money again as the stocks go back up, when driven there by earnings. Many of the Ag stocks currently have high multiples. Many are high growth (POT, MOS, AGU, IPI to name a few), so maybe they deserve these multiples. However, the investment bankers cannot make huge profits on these stocks if they go up more slowly in the future.
But, if there is a big ethanol mandate repeal scare (and relatively recessionary times dictate a little lower food demand), the stocks could get beaten down (more than they have been). The banks could make good money on the way down if they are directing this. Then they could make good money again as the prices are later driven back up as the great future earnings come in.
I don't think the individual investor should allow himself/herself to be manipulated in this way. These stocks have significant upside potential. If you believe these stocks may have significant potential downside risk due to a possible ethanol mandate repeal, don't buy them. However, don't contribute to the investment banks' market game. You are bound to get hurt doing that. They know when they are going to change their minds about recommending (or not recommending) the Ag stocks. You do not. You can be sure that they will take full advantage of this.
On a past earnings and predicted earnings basis, most of the Ag stocks still look great. In fact, the food production area seems likely to be a high growth area for some time to come, regardless of the ethanol situation. Ethanol is merely providing an early boost to the fire. The BRIC et al high growth economies are providing the real fuel for this growth. As they get more prosperous, these countries are demanding more food. They have huge populations. Ag looks like a solid investment for the long term. If you want more clarity on this issue, write to your Congressman or your Senators. They are the only ones who can really give you an accurate estimate of their likely actions.
Stock position: None.
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This article has 57 comments:
Studies by Argonne Laoratories contnue to show the benefit of Ethanol.
THE COEA has old Congess that the availability of Ethanol , priced at 40 cpg below gasoline is helping to stop gasoline from going up at least 30 cpg saving the US consumer about $ 40 billion per year.We are only spending $ 5 biilion a year on the subsidy; so we are getting a great return
Ethanol has taken 7 % of the market away from the oil bandits and they hate the product.The great Dupont has formed a J/V with the best enzyme company--Danisco-- in the world and are rapidly developing cellulosic based technology that will start operations in late 2009. Dupont, Danisco and the state of Tennese have committed $170 to the venture.
Where you fall short is buying into the concept of cellulosic ethanol, as that technology has not been developed, and may never be developed. If you had gone back to the 1970's, and looked at this subject then, you would have seen similar research projects on-going to convert rejected crop residue to ethanol, and those projects were not successful either, and eventually dropped. Developing the bugs to do the conversion, failed.
I predict a similar outcome this time, and like you said, even if it can be developed, the costs are going to be huge. The crop residue from corn is one feedstock being proposed, as it currently is being just left in the field (another is switch grass). How much can one expend in the way of fuels and time in collecting and hauling these very nearly wothless 'crops'? For instance, could one spend days collecting these so-called crops, then hauling them hundreds of miles to a processing plant? The economics simply do not work out, and that is if the process can be developed. I would add, if it could have been developed, after decades of work, it would have already be available. And that does not address your point of the lesser energy output from ethanol, which is a major problem.
Why not just take the subsidy off ethanol and see what happens? If it such a great idea, it will fly on it's own. At the same time, take off the tarriff on imported ethanol, and let Brazilian ethanol come into this country without the 51 cent tax, which would allow it to compete as well. One wouldn't have to completely repeal the original mandate, just take those two steps and give it a chance to survive on it's own. If it works, leave it in. We are going to need all the energy we can get. And if it doesn't work, it will die a silent death, and no one will even notice.
The cellulosic process is proven and starting to be used. Check out Verenium VRNM for example.
I see a gradual move to B99 bio-diesel fuel in the medium future. Also if E85 became more commonly available, ethanol-only engines could have much higher compression ratio which would, to an extent, offset it's lesser calorific value.
We talk a lot about energy balance, efficiency and so forth but, if push came to shove, I would happily drive to town in a steam-powered conveyance burning Yaupon holly from my property!
xpat
Congress is unlikely to upset the Midwest. It seems to me I read that ethanol has just been factored into the new housing bailout bill.
Two answers to the Ethanol issue:
(1) Buy from Brazil. Why not get on the Petrobras/Brazil bandwagon.
(2) Get away from corn. Go to switchgrass and other plant types. (Can't remember the name of the plant (my brother-in-law called it jojoba, and now that's the only name that comes to mind... ) But the results can yield 6 to 8 times more energy and the plants grow in uglier less useful soils, thereby freeing up land needed for food. Remember where the caucuses are held though! Iowa.
Anyway.. This also from Wikipedia:
Added to gasoline, ethanol reduces ground-level ozone formation by lowering volatile organic compound and hydrocarbon emissions, decreasing carcinogenic benzene, and butadiene, emissions, and particulate matter emissions from gasoline combustion.[39]
Combustion of ethanol in an internal combustion engine yields many of the products of incomplete combustion that are produced by gasoline and significantly larger amounts of formaldehyde and related species such as formalin, acetaldehyde, etc..[40] This leads to a significantly larger photochemical reactivity that generates much more ground level ozone.[41] This data has been assembled into The Clean Fuels Report comparison of fuel emissions[42] and shows that ethanol exhaust generates 2.14 times as much ozone as does gasoline exhaust. When this is added into the custom "Localised Pollution Index (LPI)" of The Clean Fuels Report the local pollution, i.e. that which contributes to smog, is 1.7 on a scale where gasoline is 1.0 and higher numbers signify greater pollution. This issue has been formalised by the California Air Resouces Board in 2008[43] by recognising control standards for formaldehydes et al as an emissions control group much like the conventional NOx and Reactive Organic Gases (ROGs).
jegan ;-)
David Blume is the best source of information I have found that gives you up to date detailed info on the ethanol debate not a 30 second sound bites from 25 year old studies done with outdated equipment to make ethanol look bad and oil look good.
With alcohol fuel, you can become energy-independent, reverse global warming, and survive Peak Oil in style. Alcohol fuel is "liquid sunshine" and can't be controlled by transnational corporations. You can produce alcohol for less than $1 a gallon, using a wide variety of plants and waste products, from algae to stale donuts. It's a much better fuel than gasoline, and you can use it in your car, right now. You can even use alcohol to generate electricity. Alcohol fuel production is ecologically sustainable, revitalizes farms and communities, and creates huge new opportunities for small-scale businesses. Its byproducts are clean and valuable. Alcohol has a proud history and a vital future.
To learn more, watch the Five-Minute Video www.permaculture.com/ by ethanol expert David Blume he hits many of the high points as to why alcohol fuel is the smart, sustainable alternative energy solution, in this mind-opening 5-minute version of a longer interview (conducted by Wayne Garcia of Portland, Oregon, Fox 12 KPTV, in October 2007).
David Blume’s Two-Minute Summary www.alcoholcanbeagas.c... .
Busting the Ethanol Myths
www.alcoholcanbeagas.c...
Myth #1: It Takes More Energy to Produce Ethanol than You Get from It!
Most ethanol research over the past 25 years has been on the topic of energy returned on energy invested (EROEI). Public discussion has been dominated by the American Petroleum Institute’s aggressive distribution of the work of Cornell professor David Pimentel and his numerous, deeply flawed studies. Pimentel stands virtually alone in portraying alcohol as having a negative EROEI—producing less energy than is used in its production.
In fact, it’s oil that has a negative EROEI. Because oil is both the raw material and the energy source for production of gasoline, it comes out to about 20% negative. That’s just common sense; some of the oil is itself used up in the process of refining and delivering it (from the Persian Gulf, a distance of 11,000 miles in tanker travel).
The most exhaustive study on ethanol’s EROEI, by Isaias de Carvalho Macedo, shows an alcohol energy return of more than eight units of output for every unit of input—and this study accounts for everything right down to smelting the ore to make the steel for tractors.
But perhaps more important than EROEI is the energy return on fossil fuel input. Using this criterion, the energy returned from alcohol fuel per fossil energy input is much higher. In a system that supplies almost all of its energy from biomass, the ratio of return could be positive by hundreds to one.
Myth #2: There Isn’t Enough Land to Grow Crops for Both Food and Fuel!
According to the U.S. Department of Agriculture, the U.S. has 434,164,946 acres of “cropland”—land that is able to be worked in an industrial fashion (monoculture). This is the prime, level, and generally deep agricultural soil. In addition to cropland, the U.S. has 939,279,056 acres of “farmland.” This land is also good for agriculture, but it’s not as level and the soil not as deep. Additionally, there is a vast amount of acreage—swamps, arid or sloped land, even rivers, oceans, and ponds—that the USDA doesn’t count as cropland or farmland, but which is still suitable for growing specialized energy crops.
Of its nearly half a billion acres of prime cropland, the U.S. uses only 72.1 million acres for corn in an average year. The land used for corn takes up only 16.6% of our prime cropland, and only 7.45% of our total agricultural land.
Even if, for alcohol production, we used only what the USDA considers prime flat cropland, we would still have to produce only 368.5 gallons of alcohol per acre to meet 100% of the demand for transportation fuel at today’s levels. Corn could easily produce this level—and a wide variety of standard crops yield up to triple this. Plus, of course, the potential alcohol production from cellulose could dwarf all other crops.
Myth #3: Ethanol’s an Ecological Nightmare!
You’d be hard-pressed to find another route that so elegantly ties the solutions to the problems as does growing our own energy. Far from destroying the land and ecology, a permaculture ethanol solution will vastly improve soil fertility each year.
The real ecological nightmare is industrial agriculture. Switching to organic-style crop rotation will cut energy use on farms by a third or more: no more petroleum-based herbicides, pesticides, or chemical fertilizers. Fertilizer needs can be served either by applying the byproducts left over from the alcohol manufacturing process directly to the soil, or by first running the byproducts through animals as feed.
Myth #4: It’s Food Versus Fuel—We Should Be Growing Crops for Starving Masses, Not Cars!
Humankind has barely begun to work on designing farming as a method of harvesting solar energy for multiple uses. Given the massive potential for polyculture yields, monoculture-study dismissals of ethanol production seem silly when viewed from economic, energetic, or ecological perspectives.
Because the U.S. grows a lot of it, corn has become the primary crop used in making ethanol here. This is supposedly controversial, since corn is identified as a staple food in poverty-stricken parts of the world. But 87% of the U.S. corn crop is fed to animals. In most years, the U.S. sends close to 20% of its corn to other countries. While it is assumed that these exports could feed most of the hungry in the world, the corn is actually sold to wealthy nations to fatten their livestock. Plus, virtually no impoverished nation will accept our corn, even when it is offered as charity, due to its being genetically modified and therefore unfit for human consumption.
Also, fermenting the corn to alcohol results in more meat than if you fed the corn directly to the cattle. We can actually increase the meat supply by first processing corn into alcohol, which only takes 28% of the starch, leaving all the protein and fat, creating a higher-quality animal feed than the original corn.
Myth #5: Big Corporations Get All Those Ethanol Subsidies, and
Taxpayers Get Nothing in Return!
Between 1968 and 2000, oil companies received subsidies of $149.6 billion, compared to ethanol’s paltry $116.6 million. The subsidies alcohol did receive have worked extremely well in bringing maturity to the industry. Farmer-owned cooperatives now produce the majority of alcohol fuel in the U.S. Farmer-owners pay themselves premium prices for their corn and then pay themselves a dividend on the alcohol profit.
The increased economic activity derived from alcohol fuel production has turned out to be crucial to the survival of noncorporate farmers, and the amounts of money they spend in their communities on goods and services and taxes for schools have been much higher in areas with an ethanol plant. Plus, between $3 and $6 in tax receipts are generated for every dollar of ethanol subsidy. The rate of return can be much higher in rural communities, where re-spending within the community produces a multiplier factor of up to 22 times for each alcohol fuel subsidy dollar.
Myth #6: Ethanol Doesn’t Improve Global Warming! In Fact, It Pollutes the Air!
Alcohol fuel has been added to gasoline to reduce virtually every class of air pollution. Adding as little as 5–10% alcohol can reduce carbon monoxide from gasoline exhaust dramatically. When using pure alcohol, the reductions in all three of the major pollutants—carbon monoxide, nitrogen oxides, and hydrocarbons—are so great that, in many cases, the remaining emissions are unmeasurably small. Reductions of more than 90% over gasoline emissions in all categories have been routinely documented for straight alcohol fuel.
It is true that when certain chemicals are included in gasoline, addition of alcohol at 2–20% of the blend can cause a reaction that makes these chemicals more volatile and evaporative. But it’s not the ethanol that’s the problem; it’s the gasoline.
Alcohol carries none of the heavy metals and sulfuric acid that gasoline and diesel exhausts do. And straight ethanol’s evaporative emissions are dramatically lower than gasoline’s, no more toxic than what you’d find in the air of your local bar.
As for global warming, the production and use of alcohol neither reduces nor increases the atmosphere’s CO2. In a properly designed system, the amount of CO2 and water emitted during fermentation and from exhaust is precisely the amount of both chemicals that the next year’s crop of fuel plants needs to make the same amount of fuel once again.
Alcohol fuel production actually lets us reduce carbon dioxide emissions, since the growing of plants ties up many times more carbon dioxide than is created in the production and use of the alcohol. Converting from a hydrocarbon to a carbohydrate economy could quickly reduce atmospheric carbon dioxide.
> creating a higher-quality animal feed than the original corn.
Maybe we can do that with our wheat and rice and oats - make ethanol and eat leftovers and become leaner animals and drive ethanol filled cars. Maybe even drink some of that given the completely made up arguments.
Look at the work of UC Berkeley scientists instead of this bizarre comment to get some facts: berkeley.edu/news/medi...
I should also note that they currently have two processes to produce cellulosic ethanol. One is fermentation. The other is gasification. Currently both of these are relatively expensive. However, I don't find it hard to believe that enginuity will find a way to make it cheaper.
corn-to-ethanol is a method of converting natural gas to motor fuel since NG is used to make hydrogen for fertilizer manufacture. you can do the same thing using NG-to-MeOH and Mobil's MeOH-to-high octane gasoline process,
> jack
2. Redbaron... it is a weak argument to state that research into cellulosic ethanol was not completely successful in the 70's, therefore it will never be. That's a silly argument. There are literally 100 times more researchers and research dollars doing into cellulosic ethanol now than there was 30 years ago. Tremendous progress has been made. There's a reason why the top venture capital firms in the world have invested over $500 million into this sector in just the past 18 months. CE facilities are now being built in several locations and costs of production are estimated to be $1 per gallon. Expect this to be successful.
3. Much of the work being done in this sector is based on using wood as a feedstock. If one actually takes the time to figure out how much biomass can be produced sustainably from forests and from fast growing "energy" plantations, the potential energy contribution is enormous. Again, there's a good reason why so much money is flowing into this work from many very smart people. One of those reasons is because it's clear that the only way to replace the oil used in plastics and chemicals is to get it from biomass. You can't make plastic from solar, wind or hydro power.
First of all, corn (or other higher rank feedstock) ethanol's extremely energy intensive distillation phase make the nonsense of "we can make ethanol for $1 a gallon" nearly impossible if nat-gas or other heat source fuel is even remotely priced near market costs of the recent past. And you can Fuggediboutit at todays prices.
Secondly, pining away for "cellulosic" is missing some basic input costs likely to burst that particular bubble. The diesel fuel alone for transporting large volumes of "switchgrass" or other feedstock to a processing plant probably eats up any net end value as an energy source, and let's try not to forget the laborers, irrigation pumping, and land cost as realistic inputs to true cost...
The problem with all these "renewable" fuels is... they really aren't renewable. Without hydrocarbons as an accessory before the fact... or limitless fusion power, that is.
You simply cannot distill large amounts of alcohol without massive heat inputs... from... (drumroll) cheap (read: hydrocarbon) fuels. Better to just use the nat-gas in the car engine in the first place... and eat the corn. T-Boone ain't dumb.
I can hear the objections to this reasoning already... "Boy, it sure would be nice if something that didn't need massive distillation energy would be feasible", (and that is just what excited many about butanol)... or... "Boy, I'll bet some scientists already perfected this but the oil companies bought the patents"...
But the reality is... To make bio-butanol or other higher order alcohol fuel (from non-hydrocarbon source) isn't any piece of cake either... witness the extremely difficult tasks in solving the solubility concentration/toxicity... problems. If it was easy we would already see it... maybe in a decade there might be a breakthru making EROEI a non-issue, but knowing science and engineering, and remembering Newton's thermodynamic truths about TANSTAAFL, I have to doubt it.
Since this is a stock market blog: buy VeraSun Energy, VSE, enjoy the boom.
Final note, at the present time Brazil has enough excess ethanol capacity to provide less than 10% of the U.S. demand and are already shipping most of their excess capacity to the U.S. It would take them several years to tear up enough rain forest to plant enough sugar and build enough plants to make a major dent in the U.S. usage.
The idea that algae would be used as feedstock for alcohol is fairly puzzling for someone "so well versed" in his subject matter.
Algae can be nearly 40% kerogen type oil... it is a feedstock for synthetic diesel, not alcohol. The "green" remainder may be processed perhaps, but would be extraordinarily inefficient, IN COMPARISON TO THE BIODIESEL SO PRODUCED.
If algal oil ever becomes a large scale alternative fuel, the wasted energy used in converting the "green residue" into alcohol would already have been obviated by the better use of that energy and investment in greater algae production... for more biodiesel.
Think of it like scientific resource allocation, AFTER a breakthrough technology emerges... in this case large scales are needed for any solution to this overall fuel scarcity problem, but also if a large scale solution becomes a reality, other processes would now exist in a new paradigm.
One more reason that the car of the future will most likely be powered by hybrid turbodiesel-electrics.
Unfortunately, the facts really don't support much of anything you have said. To the extent you wish to refute what I am about to say, please document your statements.
1. The latest studies on cellulosic ethanol production put the "energy out to energy in" balance at approximately 8:1. These are independent scientific analyses by organizations such as Argonne National Laboratory.
2. To understand expected production costs, you can go here: thecesite.com/calculat...
Your point about transportation costs is meaningless. Much of the work in the CE sector is in regards to using wood chips as a feedstock. Those costs are well known, as large volumes of wood chips are delivered every day to biomass energy facilities around the country... and all costs are obviously factored in.
3. Not only is cellulosic ethanol a renewable fuel, it is considered one of very few potentially "carbon negative" fuels (meaning, it can reverse global warming). Solar, wind and hydro, for example, cannot replace this critical function. Please... before you respond to this and state that burning wood or using wood as a fuel contributes to greenhouse gases, DOCUMENT your statement with facts. You won't be able to. And please don't talk about corn ethanol. We're not discussing that. We're discussing cellulosic ethanol.
Your statements are simply opinions of how you would like things to be to support some kind of agenda you have about renewable energy, but they are not supported by facts.
All forms of renewable energy are vital to solving our energy problems. Natural gas... being a non-renewable... has a limited, short-term function to play in addressing this problem, but let's be clear that it is still a major contributor to greenhouse gases, is not renewable, is becoming more expensive by the day, and is controlled by a handful of corporations (including Mr. Pickens). If you think natural gas prices will remain low, I've got a bridge to sell you...
First of all, I am quite certain that our current low nat-gas prices are to rise substantially, and so will the cost of using nat-gas as a "input" to creating some other "fuel", which is what I was referring to. Using a prime fuel like nat-gas to distill ethanol is foolhardy in the extreme... but with current tax-credits and absurd accounting, this is exactly what happens.
It takes over 8 cubic feet of nat-gas to evaporate 1 gallon of water in an IDEAL system, unfortunately, if you understand Newton, you will realize that no such system would ever exist... the entire system, even if somehow placed in a vacuum (doing away with conductive losses) would still lose energy via infrared heat loss ... the most likely input of nat-gas in the current distillation of ethanol is estimated at 30 cubic feet nat-gas per gallon ethanol, the gas being valued calorically at over 30,000 btu. Unfortunately, ethanol contains less than 80,000 btu per gallon, so even if ALL OTHER INPUTS were provided by Angels with no human or resource inputs to consider, an EROEI of greater than 2.7 is IMPOSSIBLE if distillation techniques are anything "worldly".
I'll dose out some more after you chew on that one for awhile.
Do you think anyone can take your story of the "energy out to energy in" balance as being more scientifically valid than one done by Argonne National Labs and other scientific research facilities? I asked you not to simply create some personal opinion about this matter but to DOCUMENT with a scientific study by a reputable body. Since you didn't do that, it's becoming obvious you have a personal opinion about the energy balance, but nothing hard to support it. As such, your statements can't be taken seriously.
You can start by going here to learn more about the facts behind cellulosic ethanol:
www.coskata.com/AboutF...
A few more links for you showing the net energy balance of cellulosic ethanol to be well over 5:1.
en.wikipedia.org/wiki/...
www.pnas.org/content/1...
gas2.org/2008/03/14/sw.../
Oh yeah, then you also don't need Angels to provide the other 80% of the work needed to make that fantasy happen.
ADM co-fires coal & chopped-up scrap rubber tires in circulating fluidized-bed boilers using limestone sorbent to capture sulfur emissions.
> jack
There's no need to say anything more to you about this matter. I've asked you numerous times to provide independent studies documenting your positions, but you cannot do that. Obviously, you are making your position up as you please.
Again, if you want to have any credibility here, please go ahead and refute the links I have provided by showing studies to the contrary.
The figures quoted on my web site under the "CE Cost Analysis" area represent the only documented breakdown I can find as to CE production costs because all the cellulosic ethanol companies are keeping their numbers private. The numbers I provide were done by a university in Oregon several years back (as it says on that page). This means some of the figures are dated. Yes, natural gas has gone up in price, but the techniques used to produce CE have vastly improved since then. Again, all you need to do is provide counter evidence through other studies... not your own stories (which no one buys). I've provided numerous links documenting my statements.
As far as my own work is concerned, I am in the forest products sector in northern Vermont (as my bio shows) and have worked for 30 years on sustainable forestry issues. Lavish lifestyle?... you just love to make up stories to support your own personal opinions.
This is my first day at this site. Just curious what's going on here.
I see by your numerous comments on other topics that you have a rather loud and obnoxious voice. I've bumped into your type before. Normally, I'd expect a site like this to chase folks like you away. That might happen yet.
In any event, you've been challenged numerous times now to document anything you have said in your discussions with me by independent research. So far, I've seen none of that from you.
Your credibility is in serious question. All eyes are on you to see if you can document ANYTHING you say, or if you prefer to simply continue being loud and obnoxious.
By the way, I've reported your usage of terms like "bozo" and "stupid" to the folks at this site. You're treading on dangerous ground.
Richard
Buy Gazprom ADR's...
Buy it when it's valued cheaply (every price it's ever sold at)...
Buy it when it's expensive (never has been yet)...
Buy it when they bash it in the West (it's a ploy)...
Buy it when Gazprom announces bad news (rare, but it happens)...
Hold it until the world realizes that N-G and Nuclear and Conservation and Wind is the best bridge we have until the fusion-tokamak boys actually achieve a workable reactor. Maybe 100 years from now... and pray they succeed...
Of course, the coming resource wars will probably wipe out 6 billion + before the tokamak boys succeed... so say your prayers and ask Christ to be merciful on you and your family, and be merciful to the doomed who will be starving while you wait for the end...
Now I'm a liar and a weasel. Do you have any more intelligent words to add here? Please... start throwing out a few four letter comments, why don't you. That would seem to be the next logical step.
I have clearly responded to your query earlier on by stating that the production numbers at my site are from a dated study done by a major university in Oregon several years ago. What don't you understand about that?
Your obnoxious responses do nothing to bolster your credibility. We're all waiting for something more from you.
I have stated that vastly improved processes are now in place to produce cellulosic ethanol, but that the breakdown of those production figures are confidential to the companies that own them.
I have given you numerous current links documenting EROEI for cellulosic ethanol, but you refuse to discuss those. Why not? Obviously, you just don't like the results of those studies. They don't fit your opinions.
I can give you numerous links to statements from current CE companies where they state they can produce CE for $1 per gallon. But you don't like this either.
We're all waiting for something more from you.
As far as my history is concerned, my bio is at my web site. I'll put it up against yours anytime. Please... point us to your bio.
Let me tell you a bit about where I'm coming from in telling you about my choice of Gazprom as a lifeboat for my children...
Since I was a boy (over 40 years ago) I was extremely concerned about energy issues, and it has guided my life all these years... school, work, lifestyle...
My concern for mankind's future was multiplied 100 fold with the birth of my first child... it has increased continually since...
If I could just wave a magic wand and make it all go away (our problems) believe me, I'd wave a telephone pole.
About 20 years ago, I had to turn down a chance to work on the Tokamak program at Princeton... I took a different job at the time to better help some friends of mine in Detroit who needed the work I could manage instead... I helped some friends and their families, but I've regretted every second not taking the other path...
Even when oil was cheap (foolishly priced) I lived as though it was dear... a gift from God (like a bank account buried) that would make possible billions of souls... waste was a real sin in my mind.
I worked in Russia, Germany, Poland, Italy, other eastern Europe and CIS countries... and learned first hand what physical poverty coupled with mental and spiritual richness looked like, first hand.
If you have kids, they will be among a generation that curses their forebears for the mess we hand them... all you can do is inflate a lifeboat for them... and get them tough enough mentally to deal with what is coming, without them losing their blessed souls in the process.
If people in this country had faced the unpleasant facts 30+ years ago, we would not be in this mess. Unfortunately, as you can see here at S-A, too many charlatans pretend THEY have the answers, even when they do not even know the basics of God's laws, or worse, they know them, but deceive in presenting "facts" that are not, for some personal gain.
I have answered your question numerous times already, but please... go ahead and ask it again (I'm fairly stupid, remember?). But DO NOT ask me to comment on the validity of the dated study at my web site, as I have stated repeatedly that those numbers are somewhat old and are to be used as a starting point only. I have to assume you are asking a different question, so please restate it.
I'm going to go a bit more slowly for you. I see this is hard for you to understand.
1. I sent you several links on EROEI regarding cellulosic ethanol. You have not commented on any of those yet.
2. The link to my point #2 is CLEARLY stated to be in regards to production costs, NOT EROEI. Why do you continue to try and twist that into something it is not? Those production numbers are just that... some dated information on how to understand $1 per gallon production figures.
Obviously, you do not want to comment on any of the links I sent that specifically talk about EROEI because they prove you are incorrect. Instead, you try to twist my explanation of a totally different point to suit your opinions.
Very bizarre. I'd say your credibility on this issue is in serious jeopardy.
Hah.... To good, or to easy to be ...thruht...??
They did the same with the discovery of James Lind
(1716–94) British naval surgeon; published Treatise on the Scurvy (1753) demonstrating the value of fresh fruit and lemon juice to prevent or cure scurvy.
Was it that easy .....?
For over centuries they did not(would not) recognize his discovery, because there where other stakes at hold....
Still his discovery had a long breath and overcame!
And in the end Ethanol.... does !
Do you really think anyone is taking your responses seriously? Are you kidding?
First of all, I sell NOTHING at my web site. I display not one single ad and promote no product. The site is purely informational... and will remain so. Your comments regarding this are just silly.
Secondly, I pointed to a study at my web site SOLELY in regards to production figures... not EROEI. Please... show us all IN MY POSTS HERE where I said that this study at my site is in regards to EROEI.
You are being challenged again now, so at least document this! Document something you say... anything. And by the way... still waiting for your bio.
Like I said in one of my first posts, I've run into your type before. All talk... no evidence. Not a shred of documentation to prove anything you say. Just talk... and obnoxious talk, on top of it.
But go ahead... dig yourself in deeper. We're all watching.
Another link to support my statements:
gas2.org/2008/05/01/gm.../
www.ecoworld.com/home/...
Do the EROEI calc on your own posted study. Just consider the natgas. Do it. And post it here. Then I'll go thru it all.
Can't do it? Or won't?
It's one or the other.
I'll leave it to others to sort out the merits of this conversation between us. I rest my case.
Good luck on your journey.
Richard
Sorry about your father. Losing mine was the hardest day in my life.
You'll see him in the next world. Take care of your kids and he'll be the proudest. That will be your happiest day.
______________________...
"...The energy balance for ethanol production is a matter of some controversy. Typical energy input for a state-of-the-art process like the one I have described is about 34,000 BTU per gallon of fuel ethanol. Average ethanol input for actual plants in operation, most of which are older and not state of the art, is considerable higher at about 52,000 BTU/gal. Many plants are old or small and do not use molecular sieve dryers for ethanol purification, relying on a third distillation step that consumes more energy than the dryers. Older plants also do not feature all the energy recycling and can require 80,000 or more BTU to produce a gallon of fuel ethanol. As the energy content of ethanol is about 84,000 BTU/gallon, these old plants sometime consumed more energy to make the ethanol than what was contained in the product. Even the state-of-the art process requires energy equal to about 40% of the energy in the product to manufacture fuel ethanol. The effect of plant efficiency has affected the conclusions of studies looking at the total energy efficiency of corn to ethanol conversion..."
______________________...
I had stated over 30,000 btu per gallon ethanol as a good estimate of distillation EROEI input-quant... I also pointed out that those who did not well design systems (as state of the art here shows) would probably expend much more, witness the evidence of Mr. Miller's chosen study... it required roughly 3 times what state of the art systems described above use.... but, (and to you too, Mr. Miller) you see, these values as I at first projected and then teased from your chosen study data prove what is required...
And remember, this is simply the distillation step... all other processing inputs are ignored.
Giving Ethanol refiners tax credits encourages wasteful practices and bad engineering design justified by banker logic... money as the end all and be all.
Back in the late 70's, Smoky Yunick (who else alive reading SA besides me knows who Smoky even is, I wonder...) said that someday mankind would come to it's senses and use BTU's as a currency, instead of mythical electronic notional currency units, such as the unbacked dollar really is. He observed that it would change behavior, worldwide, for the better. Wasteful practices that "seemed smart by bankers" would be exposed for the fraud that it truly was.
Smoky was right. The hypesters and banksters are wrong.
I strongly believe that the ethanol mandate will not be repealed simply because of significantly lower corn prices AND the fact that the infrastructure is already mostly in place to produce and distribute corn-based ethanol.
While it is definitely not the most efficient or socially responsible form of biofuel, it will be in the peripheral focus of US energy policy because the US has an enormous competitive advantage in corn production, as the US produces about 43% of the world's corn.
Cellulosic ethanol, wind power, solar power, biodiesel, sugar-based ethanol, clean coal, nuclear power, LNG, GTL, and even some algae tech I've read about lately should all be used as the US seeks to diversify away from "foreign oil." A modern economy is one of diversification, and with energy driving economic growth, there is no reason the US should have been dependent on oil for this long.
I could rant on and on about how I believe in supply-side economics, but I'll leave it with this: the US government needs to create a legal and tax environment that accommodates alternative energy research, development, production, distribution, and implementation and PE/VC money from Silicon Valley to Boston and everywhere in between will fund it and make some new billionaires along the way.
Never underestimate three things: human ingenuity, human creativity, and human greed...
Cheers
The biggest asset Ethanol has is the Farmers-Corn Lobby in D.C.
Everyone knows Corn doesn't hold a candle to sugar for efficiency or yield.
But as you said we need all the niche players in this "Whole new Game" .
We're going from one big player to a team and with no depth in the bench every 2% player has to be suited up!.
What matters to me is "what will continue to happen to my corn-fed Cattle?" I mean I already have to pay 50% more for Rib Eye. I used to be able to get 10 ears of corn for a buck as little as 4 years ago, now if I'm lucky its only 5.
But that's just my rant, I love steak. The more marbled, the better.
Other than the price rise in food across the world, which coincidently began with Congress and the absurd thought that food should be a viable subsitute for lack of foresight, I have heard that Ethanol Fires are extremely hard to extinguish.
Could either of you distinguished erodites give me an answer regarding car crashes involving Ethanol fires.
Do all fire departments carry the chemicals necessary to extinguish them or is it a case of "Burn, baby burn". If the latter, then I would say the Infrastructure for Corn Ethanol has a long ways to go.
"Has anyone figured how much more energy farmers are using to harvest the same amount of corn that they harvested before ethanol became a major user of corn. I would guess that energy usage in the farm belt has not changed since the ethanol boom. The corn raised is just going for a different purpose. The same number of corn acreage is still being planted."
This is an interesting comment in itself, because if it were true, it would underscore the argument that fuel is competing with food (or, to be accurate, feed). But the same corn acreage is NOT being planted. New acreage, some not previously plowed (e.g., former pastures or orchards), has been planted to corn over the last several years. Other acres have been planted to corn that were previously planted to wheat or soybeans. Overall, 19.5% more acres were planted to corn in 2007/08 than in 2006/07. See the graphs on this USDA web page:
www.ers.usda.gov/brief...
Generally, corn requires more fertilizer and more machinery fuel per acre (not necessarily per ton) than wheat. Not a lot more, but some more. And certainly corn cultivation requires a lot more fuel than grazing cattle.
Tim Plaehn then claims,
"[A]t the present time Brazil has enough excess ethanol capacity to provide less than 10% of the U.S. demand and are already shipping most of their excess capacity to the U.S. It would take them several years to tear up enough rain forest to plant enough sugar and build enough plants to make a major dent in the U.S. usage."
This is a self-serving argument, one frequently used by protectionists: "There is no point in lowering trade barriers, because our foreign competitors wouldn't have the capacity to supply us!" Well, if that would be the case, what's the worry? But of course, this is circular logic. If Brazil could count on trade barriers staying down, it would of course build up that capacity.
But that capacity would bot be in the Amazon but in the Cerrado (Brazil's savannah). Despite Brazilian experts explaining this to every person they meet, I guess that fact hasn't yet registered with Tim.
Last quarter for example Exxon-Mobile Paid $32 Billion in taxes and there net profit was $11.6 Billion. So if you want wind-fall profits just look to the government there take is all wind-fall.
Someday soon, I fear that the US Gov will finally do the currently "unthinkable"... confiscate effectively all profits from public energy companies... with a 90%+ tax rate.
They will use their "Warts on Terriers" justification. It will be speechified that back during WWI & WWII there were "dollar a year men", and that nobody should profit while the "Wart" is on.
Of course, by then, marginal personal income tax rates will probably be over 75%, social sec taxes will be over 25%, unemployment will be 50%+ (except for government employee types)...
And smart Americans will already be living and working in Russia, sending care packages by DHL back to their unlucky brethren.
...point being the way we historically do things is not necessitate that they will always be the best practice. Lots of efficiencies will be gained as demand and competition increases.
I appreciate your comments on my "analysis". You have valid points. I will reply on the acreage note, looking at the graphs is is fairly obvious that from 06 to 07 farmers elected to plant corn instead of soybeans. Note that soybean acreage fell quite a bit. I grew up in Iowa and farmers their plant either corn or soybeans depending on what they believe will be most profitable. Also, the first graph in you link shows total planted acreage for all crops pretty level for the last several years and well below the amount planted in the 1980's.
In regards to Brazilian ethanol I find it very hard to believe that the U.S. Congress would ever pass legislation that would benefit Brazilian agriculture at the disadvantage of U.S. farmers. Think about it.
I am happy that my investment in VeraSun Energy is up 65% in the last 5 weeks.
And Mr. Subsidy Eye, I see you are Swiss based. Are you interested in U.S. investing or using Seeking Alpha for another agenda?