Thomas P.M. Barnett :: Weblog

The current upward momentum of the biofuel industry will be short lived unless another plant besides corn (swithgrass has been mentioned) can be utilized and an improved method can be developed to break down the sugars in the plants. It takes about 1.5 gallons of ethanol to produce the same amount of energy as a gallon of gas and the industry still needs to be subsidized to make any money. Honda is going to introduce the FCX Clarity this summer in California. It is hydrogen powered, 68mpg equivelent, 270 mile range for $600 per month. GM is not far behind. I'm sure the farm lobby will push for continued use of biofuels, but the economics don't support it. Let's hope the politicians don't either.

Build a nuke plant in every town and give us electric cars.

At the present time, ethanol fuel does make economic sense. It costs approximately $1.00 to $1.20 to produce a gallon of ethanol from corn in the United States. The wholesale price of that gallon of ethanol, which depends on the wholesale price of gasoline, is approximately $2.50 a gallon. Lots of room for profit there. The subsidies we hear about all the time are a tax credit of $0.51 per gallon of ethanol when mixed at more than 10% of the volume of fuel. That means that E10 gets a tax break of about a nickel a gallon and E85 gets ~$0.43 a gallon. Most ethanol used in gasoline in the United States today is used to replace MTBE which has been effectively banned by threat of lawsuits. It is less than 10% of the blend so it does not get any tax credit.

Gasoline has more energy than ethanol? It also burns hotter so a lot of that extra energy does nothing but make your radiator work harder to get rid of the extra heat. Actual mileage loss with ethanol tends to be more in the 10% to 15% range for older flex fuel vehicles and no difference to slightly better mileage with newer flex fuel engines.

Ethanol raises the octane of fuel. A 10% ethanol mixture has an octane rating of 95. If all gasoline sole in the US were at least 95 octane, car makers could increase the compression ratio of their engines from today's 8:1 to something like 10:1 which was more common in the 1960s before lower octane unleaded gasoline was mandated. Higher compression ratio engines are more efficient. They get better fuel mileage and they have more power for their size. Diesel engines have compression ratios of 14:1 to 20:1 which is why they get more miles per gallon.

But ultimately, sugar cane is a much better plant to make ethanol from than corn. There are very few places in North America where sugar cane can grow which is why we are making ethanol from corn in this country. However, in Brazil they make ethanol from sugar cane for about $0.50 to $0.80 a gallon. They have to pay a $0.54 a gallon tariff to import ethanol into the United States which is why the Brazilians export most of their ethanol to Europe and Japan.

Africa can produce sugar cane. The thing that has kept them from producing far more sugar cane than they do today has been restrictive agricultural policy in the United States and in Europe. Africa was not even producing enough food to feed its population because the US and EU were dumping food into their markets at prices lower than the cost of production. The end of that food dumping as a result of corn being used for biofuel and animal feed is causing the rioting mentioned in one of those articles. However, another article shows that in a place like Malawi the locals can not only increase their food production enough in one year to feed themselves but also produce enough of a surplus to export and feed other people.

These articles show some of the disruption that occurs during a period of transition. The economic rise and increased demand from China and India happened pretty quickly. As one article mentioned, it takes eight years after oil palms are planted before they become productive. It takes time to build new factories, shift agricultural production and in places like Africa build new infrastructure like roads that will help connect Gap countries to the Core. During these transition times, some people will get rich before things settle down into a stable, mature industry.

You might want to read Robert Zubrin's book on the subject.

Sorry to go so long. My initial thought was to post a brief comment on biofuels increasing flows between Gap and Core but somebody has to refute the misinformation that is constantly being spread about biofuels.

I'm new to your view of life, security and everything, but I'm surprised that you think that cloning farm animals is a good idea. I'm pretty sure there are no human health risks, and I'm not in the least bit bothered by the animals' sense of identity. I am, however, worried about the consequences of too narrow a genetic base.

Restricting diversity in this way is a disaster waiting to happen. You're more familiar with arms races than I am, I expect, but with parasites that can multiply (=new approaches to getting through the host's defences) so much more rapidly than the hosts themselves can shuffle their genomes (=new defences), and with clones removing even the little shuffling that goes on, it really is just a matter of time.

We've seen this, several times, with crop plants. In 1971 a disease wiped out fully half of the US corn (maize) supply, a direct result of restricted genetic diversity. Losses ran into the billions. Of course the US (and any other developed country) can just go out onto the market and pay more for food, so there's no risk of hunger, any more. But what is the impact on poor countries that take the money and run?

The big problem with cloning is that it makes livestock much more vulnerable to an epidemic of disease, and that is why accepting cloned animals into the food chain, which gives them additional value in the eyes of farmers, is a bad idea.

Mark: Good points. Hopefully an improved method will be perfected that can break down non food plants that are abundant in the US that doesn't inflate the price of food, is cheap to produce and leads to a larger degree of energy independence. In the end hopefully, the market will determine the winner between biofuels and other competing forms of energy. We will have to revisit the subject in 10 years or so to see where it all stands.

Food riots. In Mexico. This isn't good:(