Corn ethanol
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| Wed, 05-06-2009 - 7:02pm |
Democrats have loved ethanol for years, it is a green fuel. Republicans learned to love the high corn prices corn ethanol assured some constituants. Everyone was happy. Then today, I read the following story. Before posting the entire story, I've decided to post my favorite paragraph first.
"Ethanol is also bad for the environment. Science magazine published an article last year by Timothy Searchinger of Princeton University, among others, that concluded that biofuels cause deforestation, which speeds climate change. The National Oceanographic and Atmospheric Administration noted in July 2007 that the ethanol boom rapidly increased the amount of fertilizer polluting the Mississippi River. And this week, University of Minnesota researchers Yi-Wen Chiu, Sangwon Suh and Brian Walseth released a study showing that in California -- a state with a water shortage -- it can take more than 1,000 gallons of water to make one gallon of ethanol. They warned that "energy security is being secured at the expense of water security."
The article is at - http://online.wsj.com/article/SB124000832377530477.html
In September, ethanol giant VeraSun Energy opened a refinery on the outskirts of this eastern Iowa community. Among the largest biofuels facilities in the country, the Dyersville plant could process 39 million bushels of corn and produce 110 million gallons of ethanol annually. VeraSun boasted the plant could run 24 hours a day, seven days a week to meet the demand for home-grown energy.
But the only thing happening 24-7 at the Dyersville plant these days is nothing at all. Its doors are shut and corn deliveries are turned away. Touring the facility recently, I saw dozens of rail cars sitting idle. They've been there through the long, bleak winter. Two months after Dyersville opened, VeraSun filed for bankruptcy, closing many of its 14 plants and laying off hundreds of employees. VeraSun lost $476 million in the third quarter last year.
A town of 4,000, Dyersville is best known as the location of the 1989 film "Field of Dreams." In the film, a voice urges Kevin Costner to create a baseball diamond in a cornfield and the ghosts of baseball past emerge from the ether to play ball. Audiences suspended disbelief as they were charmed by a story that blurred the lines between fantasy and reality.
That's pretty much the story of ethanol. Consumers were asked to suspend disbelief as policy makers blurred the lines between economic reality and a business model built on fantasies of a better environment and energy independence through ethanol. Notwithstanding federal subsidies and mandates that force-feed the biofuel to the driving public, ethanol is proving to be a bust.
In the fourth quarter of 2008, Aventine Renewable Energy, a large ethanol producer, lost $37 million despite selling a company record 278 million gallons of the biofuel. Last week it filed for bankruptcy. California's Pacific Ethanol lost $146 million last year and has defaulted on $250 million in loans. It recently told regulators that it will likely run out of cash by April 30.
How could this be? The federal government gives ethanol producers a generous 51-cent-a-gallon tax credit and mandates that a massive amount of their fuel be blended into the nation's gasoline supplies. And those mandates increase every year. This year the mandate is 11 billion gallons and is on its way to 36 billion gallons in 2022.
To meet this political demand, VeraSun, Pacific Ethanol, Aventine Renewable Energy and others rushed to build ethanol mills. The industry produced just four billion gallons of ethanol in 2005, so it had to add a lot of capacity in a short period of time.
Three years ago, ethanol producers made $2.30 per gallon. But with the global economic slowdown, along with a glut of ethanol on the market, by the end of 2008 ethanol producers were making a mere 25 cents per gallon. That drop forced Dyersville and other facilities to be shuttered. The industry cut more than 20% of its capacity in a few months last year.
What's more, as ethanol producers sucked in a vast amount of corn, prices of milk, eggs and other foods soared. The price of corn shot up, as did the price of products from animals -- chickens and cows -- that eat feed corn.
Texas Gov. Rick Perry reacted by standing with the cattlemen in his state to ask the Environmental Protection Agency last year to suspend part of the ethanol mandates (which it has the power to do under the 2007 energy bill). The EPA turned him down flat. The Consumer Price Index later revealed that retail food prices in 2008 were up 10% over 2006. In Mexico, rising prices led to riots over the cost of tortillas in 2007. The United Nations Food and Agricultural Organization and other international organizations issued reports last year criticizing biofuels for a spike in food prices.
Ethanol is also bad for the environment. Science magazine published an article last year by Timothy Searchinger of Princeton University, among others, that concluded that biofuels cause deforestation, which speeds climate change. The National Oceanographic and Atmospheric Administration noted in July 2007 that the ethanol boom rapidly increased the amount of fertilizer polluting the Mississippi River. And this week, University of Minnesota researchers Yi-Wen Chiu, Sangwon Suh and Brian Walseth released a study showing that in California -- a state with a water shortage -- it can take more than 1,000 gallons of water to make one gallon of ethanol. They warned that "energy security is being secured at the expense of water security."
For all the pain ethanol has caused, it displaced a mere 3% of our oil usage last year. Even if we plowed under all other crops and dedicated the country's 300 million acres of cropland to ethanol, James Jordan and James Powell of the Polytechnic University of New York estimate we would displace just 15% of our oil demand with biofuels.
But President Barack Obama, an ethanol fan, is leaving current policy in place and has set $6 billion aside in his stimulus package for federal loan guarantees for companies developing innovative energy technologies, including biofuels. It's part of his push to create "green jobs." Archer Daniels Midland and oil refiner Valero are already scavenging the husks of shuttered ethanol plants, looking for facilities on the cheap. One such facility may be the plant in Dyersville, which is for sale. Before we're through, we'll likely see another ethanol bubble.

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ITA
fairly damsely
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I've watched many boards. Once a liberal believes something is "green" (and will save the world from global warming) it gets unconditional liberal love. I base this on watching this and many other boards.
From ethanol, to small cars, to windmills, liberals in my experience on this and any other board, love supposedly green stuff.
That windmills are used to make a Texas billionaire even richer, that they cost more to produce electricity, that they require backup fossil power stations, new infrastructure which has significant environmental damage, or that General Electric has a lot of plans to make billions producing this stuff won't matter a bit to any liberal I've seen.
I think that is why we have clean coal commercials. It somehow is supposed to make coal appear "green" and thus deserving of liberal love. That it may cost hundreds of billions of dollars, to produce "green" coal power, and our electric bills may double, is no reason for "green" anything not to be loved.
I believe the environmental damage which results, happens later, or out of sight. This creates a new cause for any good liberal to fight. Thus there is a perpetual new fight to constantly keep "green". Which will never end, but will make many companies and billionaires very rich off the backs of wage slaves. :(
The corn lobby has Democrats and Republicans in it. They are out to make money off the "green" fuel liberals love called corn ethanol.
That liberals love it, got it off the ground, and into law is really not debatable IMO. Once people started making money off it, ethanol became self perpetuating.
Liberals will still love ethanol. The environmental problems it creates, like deforestation, water pollution, lack of drinking water, desertification of our southwest, higher food prices, higher energy prices, lower MPG, more pollution, and higher costs for everything will all be the source of new liberal crusades. :(
I so wish people would think these things through. Corn ethanol was a no starter to me within 20 minutes of my researching it. It was obviously a boondoggle.
Yet the One will continue to push it. It is now part of his core liberal beliefs, and he believe it is the will of his constituency. Which I believe also. See the One and I are in agreement that liberals love corn ethanol. :)
Edited 5/7/2009 8:58 pm ET by postreply
You are making blanket statements (again) when there is plenty of proof to the contrary about liberals speaking out against questionable energy sources. I encourage you to go to the advanced search option of iVillage and use the search condition to look up key words and phrases--ethanol, biofuel, alternative energy sources, whatever you wish. Do it here, do it on the Politics Today board. For that matter, just look at what I've written in this thread alone.
Clearly, a battle is brewing between the old status quo fossil fuels and nuclear power; and the upstart contenders of solar, wind, biofuel, geothermal. Gallons of "greenwashing" isn't limited to the coal companies or T. Boone Pickens' endeavors. And lambasting liberals for looking to find viable alternatives? Stuff and nonsense. Posted the links to prove it too, unless you discount those links because you consider George W. Bush and the Republican party to be liberals!
On one thing, I do agree. We need to consider what environmental, societal, and geopolitical impacts ANY energy source might create. And it should be worst case scenario exploration, not just the rosy lens of what we hope for.
As far as the "wage slave" to a "green master" imagery, spare me. Oil companies made record profits a year ago, fuel and food prices were heading through the ceiling ($4 a gallon gas--remember that?)and nitwits were calling for drilling here, there, and everywhere. Let's talk about that, shall we?
It's not getting rich to which it appears you're taking exception--it's shifting the wealth to a different crew of people! Pffft.
Jabberwocka
IMO if fossil fuel is finite, we will run out of it eventually. It presents a limited problem. There is no shortage of liberal websites telling us we are out of oil, gas and just about anything else.
IMO new technology replaces old technology when it is better. Once a newer technology is developed, people will become rich providing it to us all. We shall be happy to make them rich as our costs will be lower and our quality of life will be better.
IMO much of this green CO2 stuff, reflects a desire to punish us for sin / crime against the earth / climate / whatever liberals love by increasing taxes, increasing costs, reducing quality of life, and harming our economy. IMO liberals seem to believe we must atone for some earth sin.
IMO many who are Republicans are too interested in making profits. They will support any cause which enriches them. I personally have no use for such Republicans and wish they would leave the party.
IMO humans have thrived in warmer climates, and will continue to do so. IMO global warming is a preferred alternative to global cooling. IMO there has never been a static climate, and never will be.
IMO the sun is the largest factor in determination of climate. We do not have a thermostat on our sun and it is beyond our ability to control it, or our climate.
I work from the above opinion.
"I've watched many boards. Once a liberal believes something is "green" (and will save the world from global warming) it gets unconditional liberal love. I base this on watching this and many other boards."
Not surprising that's how you get your opinions.
Ummmm.....we ARE running out of fossil fuels! Our own resources are largely defunct. Even fervent supporters of the oil, gas, and coal industries are relying on increasingly feeble logic and extraordinarily risky mining and drilling measures to try to convince us that we should not consider sustainable alternatives. Iraq was a colossal boondoggle and the industry probably fears an immediate repetition in the event of attempted political or economic domination of an OPEC nation (though our collective memory is woefully short or we'd be remembering our Middle East experiences of the 1970's).
BUT the old technology (fossil fuel and nuclear) has money, therefore it has power and friends in high places. Go gently into that good night? Not they! So they spin, whine, demand, scare, intimidate, cajole..... Reminds me of the Wizard in Oz. For all the bluster and appearance of great strength, there is very little behind the curtain to offer the United States for its future energy needs/wants. And oil companies do NOT act in the best interests of our nation, they act in the best interests of their bottom line. Anybody who conflates the two is a world-class idiot (see: George W. Bush, Dick Cheney, Donald Rumsfeld, Condoleeza Rice, Paul Wolfowitz, William Kristol, etc.).
The status quo has another advantage. Change isn't easy. People prefer easy without understanding that short-term gain often results in long-term pain. Case in point, our economy right now.
Yet another issue is the tendency of some people to believe that they're entitled to something because......whatever. Whether it's a way of life which features cheap fuel, large vehicles, subsidized housing, abundant water......whatever; they think it should be theirs. Those with money may feel themselves warranted in their expectations. They can PAY. Other costs, monetary or non-monetary, or how they acquired that money (see: Bernie Madoff) are no part of the calculus as THEY reckon it. I see a LOT of that in posts from self-styled conservatives. "I got mine because I deserve it, and Devil take the hindmost" .
Whether or not you believe that global warming is associated with man-made activity (and I have some reservations about the exact degree if such is the case), fossil fuels don't make sense anymore. For a multitude of reasons. Some of which I mention in this post, some of which have been mentioned previously by me and others, some of which haven't yet been covered here on iVillage.
Even Republicans have reluctantly come to similar conclusions. I don't know if they're the ones who you believe should leave the party, but here's the kicker. Politicians tend to be pragmatic about taking stands which are unpopular in public opinion. After all, in a democracy, they have to respond to that opinion, shape it, or see their chance to "serve" in public office, go bye-bye. PBS had an interesting piece last night featuring interviews with Olympia Snowe and Susan Collins of Maine; and Lindsey Graham of South Carolina. Unfortunately, I cannot find a link to post. They were expressing, in careful tones, their concern over the marginalization they were feeling from ideological purists of their party.
As I see it, the only way the Republicans can make a comeback on the basis of ideology is if the Democrats fail spectacularly, either through their own missteps, or with a hefty shove from the opposition party. Certainly, that's what Rush Limbaugh is hoping for! Two drawbacks occur to me immediately. IF the Democrats don't fail, the Republicans have zip to work with and will look both out-of-touch (duh) and obstructionist. And the other drawback is that any failure right now won't just adversely affect the Democrats but the nation as well. How well will that play in Poughkeepsie? For me, an independent, it would be far far far better to have an opposition party which was realistic, principled, and willing to consider the needs of a changing nation. Probably better for the nation too. But if Republicans fail to adapt and call for the demise of the RINO's, I'll be glad to give them a shovel with which to dig their political grave.
Jabberwocka
It seems to me that when I started reading about corn ethanol, it was being promoted as a 'bridge fuel'...one that would allow us some independence from foreign oil while we were working on cleaner fuel alternatives.
If and when fossil fuels run out, we shall use the next least expensive fuel appropriate for mass production.
Technology evolves over time. 100 years ago we used mostly horses and trains. 100 years before that mostly horses. We don't really know what we will be using for transportation in 50 or 100 years.
Whatever it is, I doubt our government will invent it. I'd prefer the government to just offer a fair market to all and get out of the way. Real wealth is created by the private sector.
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