Ethanol subsidies in perspective

[bill]

Re: Ethanol subsidies in perspective

Price depends on CSR and location to infrastructure.
In 2005 range of pricing was $2000-3,000 per Ac. Today 7,000-10,000.
CSR
http://www.extension.iastate.edu/agd...tml/c2-86.html

[thriftyandboringinohio]

Re: Ethanol subsidies in perspective

...Public transportation enhancement.

Yup, I hold that ethanol is overall the least attractive alternative motor fuel -CNG, propane, LNG, and methanol all make more sense to me.

But increased use of buses and trains is the easiest way to dramatically reduce petroleum consumption in transportation.

[c1ue]

Re: Ethanol subsidies in perspective

In 2005 range of pricing was $2000-3,000 per Ac. Today 7,000-10,000.
CSR

From what I've seen on iTulip and elsewhere, I think the reason farmland is going up is the same reason gold and silver is.

Clearly the cash flow isn't the attractiveness.

[bill]

Re: Ethanol subsidies in perspective

From what I've seen on iTulip and elsewhere, I think the reason farmland is going up is the same reason gold and silver is.

Clearly the cash flow isn't the attractiveness.

The run for “Real Assets” and out of the dollar has a lot to do with land price increases.
Government tax credit for ethanol started land price increase.

[globaleconomicollaps]

Re: Ethanol subsidies in perspective

I don't know about that.

The average yield per acre is roughly 42 bushels. Times 2.7 = 113 gallons of ethanol. The roughly $1 subsidy per gallon thus yields you about $100 extra per year.

How much was an acre of corn farmland in 2005?

I am trying to find a place in this thread to throw in my violent disagreement with the zeitgeist here. Don't take this as an attack c1ue, any of the posted replies would have sufficed:

1) on the subject of the suitability of corn as a feedstock for ethanol:

the actual yields are as follows

    Ethanol and Biodiesel Yield per Acre from Selected Crops

    Fuel 	Crop 	                 Fuel Yield (gallons)

      	  	 

    Ethanol 	  	 

      	Sugar beet (France) 	        714

      	Sugarcane (Brazil) 	        662

      	Cassava (Nigeria) 	        410

      	Sweet Sorghum (India)           374

      	Corn (U.S.) 	                354

      	Wheat (France) 	                277





    Biodiesel 	  	 

      	Oil palm 	               508

      	Coconut 	               230

      	Rapeseed 	               102

      	Peanut                         90

      	Sunflower 	               82

      	Soybean 	               56 (author's estimate) 

from http://www.grist.org/article/biofuel-some-numbers

I got this from the very first link on Google. Other searches will return different numbers, but not by much. People that tell you that corn will only yield 113 gallon/acre have an axe to grind. It is true that corn is a poor feedstock for ethanol, but it is not a disaster.

2) on the suitability of ethanol as a fuel for motor vehicles:

It is true that ethanol, all things being equal will give less "oomph" per unit of fuel, but all things are not equal. The Wikipedia page on ethanol fuel in Brazil goes into this in some detail, but to cut to the chase, higher compression can alleviate some of the faults of ethanol as a fuel. I live in France where you can get one of these:
http://www.scania.com/products-servi...re/270-hp.aspx

a truck engine that uses ethanol in a diesel cycle which they claim can use 40% less fuel than a normal Otto cycle engine:
http://www.scania.com/products-servi...s/ethanol.aspx
These engines have been in production for 20 years. This is not a new experimental technology.

3) on the "green" aspect of ethanol:

I am stunned that I have to remind people of this. The hostility amongst so called environmentalists to the best , most dependable, easiest to make, least environmentally polluting and ( need I point out?) most available right now fuel , out there, puts me in mind of a conspiracy theory.

I regularly hear that "You need to use gas and/or diesel to make ethanol". This a piece of transparent sophistry. The whole idea with renewables is that they are RENEWABLE! You start by making some of them and then eventually you can run your tractors, cars and delivery trucks on the stuff. Did this idea get lost somewhere in there? Likewise the idea that one need natural gas or some other fuel to boil the feedstock is inane. It is entirely possible to boil water with ethanol ( try it some time. It works great).

I have routinely encountered "environmentalists" who recommend bio-diesel as a solution. See the above chart for the advisability of that. Ethanol is a substance so clean that you can literally drink it. Bio-diesel is a deadly poison and the process of making it is poisonous as well. It requires potassium chloride and huge amounts of wash water. I think this last point is important if bio-diesel is ever made in sufficient quantities to run a significant number of cars, it will contaminate large amounts of wash water. The by products of making ethanol are pure enough to use as animal feed.

3) On the relevance of ethanol vs other alternative fuels:

I have heard persuasive arguments that we should move toward an energy future heavy on natural gas or gassified coal , or something else because we are running out of oil. Also I read for time to time about something called "net energy" that is supposed to be a problem down the road. I want to suggest a new paradigm to you right now. The future , more that anything else, will be a capital constrained world. Very little investment capital will be available to experiment with new ideas such as algae or hydrogen energy cycles. We are talking about a permanent state of crisis happening to greater or lesser extent all over the world. What do people do in a crisis? They do what they have been trained to do. They do what they know best and they keep doing it over and over again, even if it doesn't work. This is human nature. Don't fight it, work with it. Small farmers, big farmers, pretty much everybody makes ethanol. It is easy. If you took a chemistry class in high school , chances are you made some ethanol. the equipment is cheap and the product has instant appeal to everybody ( especially in an "emergency"). Ethanol wins because it is already there.

4) on the "The only reason there is ethanol is that there is artificial support for it" argument:

Come to France where the "artificial" support for plain old gasoline doesn't exist. I pay $9/gallon here in the south of France. Ethanol looks pretty good from where I'm sitting.

There are places and times when ethanol doesn't make sense. If you live in Saudi Arabia and you are making ethanol "you're doing it wrong". But look again at that chart. Notice that France ( world's number one sugar beet manufacturer) is in a good position to "go green" so to speak. I think it is almost inevitable that this part of the world will move to ethanol in the next few years.

5) growing corn for ethanol causes starvation in the third world:

this one makes my head swim. Is it really the case that paying farmers to keep their crop off the market ( proving subsidies to turn food into ~10% of US fuel) is the cause of third world starvation? In the absence of government policy supporting corn prices would they fall to a level low enough to feed every hungry mouth? Let me throw this one out there. Can anybody explicate the logical fallacy with this argument?

[Jay]

Re: Ethanol subsidies in perspective

I view ethanol subsidies in the same manner I see a lack of energy conservation policies with teeth. The results of both policies provide an effective time buffer to mitigate social unrest and mitigate the chances of a spiraling downward economy in the event of shortage. Briefly, in regards to liquid fuels, being wasteful will in effect show peak cheap oil "early." The massive wastefulness in the US system allows the easy low hanging fruit of conservation to be put in place while real solutions can be found. Europe won't have such a buffer as their system is already running based on more extensive, existing conservation measures. This conservation buffer allows time to implement real change and limits unrest.

Ethanol subsidies will work in a similar way in a possible agricultural shortage. If there is a global dislocation and food shortages become an issue, the countries with an agricultural surplus, promulgated by seemingly stupid corn ethanol policies and other policies, will have a ready source of surplus corn for the populace when the ethanol crop is siphoned back into food production. Since corn ethanol makes little economic sense, its loss won't affect the domestic energy market as much as other losses might. It can replaced with better alternatives.

[c1ue]

Re: Ethanol subsidies in perspective

1) on the subject of the suitability of corn as a feedstock for ethanol:

the actual yields are as follows

Indeed, in looking at the data - I incorrectly used the soybean yield of 42 bushels/acre. Corn is 161.9 for the US and 187.0 for Iowa: http://www2.econ.iastate.edu/outreac...es/Table10.pdf

The USDA backs up the above numbers, but also backs up the 2.7 gallons per bushel figure.

However, whatever the actual corn yield is - this doesn't change in any way the energy balance.

Whether 42 or 187 bushels, 1 gallon of gasoline still equals 4 gallons of ethanol under the most optimistic scenario with a near 1 to 1 relationship under existing conditions.

I regularly hear that "You need to use gas and/or diesel to make ethanol". This a piece of transparent sophistry. The whole idea with renewables is that they are RENEWABLE!

How renewable is it when you can't make fertilizers with ethanol?

How renewable is it when the ethanol creation process itself requires huge energy expenditures in order to distill the ethanol out of the mash?

While certainly it is true that 1 gallon of gasoline or oil isn't directly translated into 1 to 4 gallons of ethanol, it is equally true that a huge part of the ethanol creation process involves cheaper energy forms - specifically coal and natural gas.

Do you seriously think that ethanol is used for energy in the distillation process when it is so much more expensive?

Small farmers, big farmers, pretty much everybody makes ethanol.

Small farmers, big farmers, none of them make enough ethanol to help anyone except perhaps themselves.

Sure, I can make gin in my bathtub, but that's hardly a way to run a modern economy.

Come to France where the "artificial" support for plain old gasoline doesn't exist. I pay $9/gallon here in the south of France. Ethanol looks pretty good from where I'm sitting.

Are you seriously trying to tell me that the price of gasoline in France doesn't affect ethanol?

In France 70% of the gasoline price is tax.

In the US, it is 'only' 17% or so.

A high gasoline price directly supports ethanol, but the difference is France doesn't grow corn or sugarcane, though I'm sure there are some beet and/or switchgrass farmers.

The difference is that France has a high gasoline tax to discourage 'wasteful' gasoline use.

this one makes my head swim. Is it really the case that paying farmers to keep their crop off the market ( proving subsidies to turn food into ~10% of US fuel) is the cause of third world starvation? In the absence of government policy supporting corn prices would they fall to a level low enough to feed every hungry mouth? Let me throw this one out there. Can anybody explicate the logical fallacy with this argument?

There is no logical fallacy, only missing logical ability.

The reality is that ethanol subsidies lead to lower corn supply for food. Lower corn supply for food equals more expensive food. More expensive food = more 3rd world starvation. Wealthy America can afford more expensive food, but people in other nations cannot.

Certainly it isn't America's duty to feed the world, but equally it is disingenuous to refuse to acknowledge that ethanol policies don't lead to starvation.

Ethanol subsidies will work in a similar way in a possible agricultural shortage. If there is a global dislocation and food shortages become an issue, the countries with an agricultural surplus, promulgated by seemingly stupid corn ethanol policies and other policies, will have a ready source of surplus corn for the populace when the ethanol crop is siphoned back into food production.

This might make sense if land was being converted from shopping malls to growing corn, but what really seems to be happening is farmers are switching from other crops to corn.

Thus it isn't that the food supply is being expanded so much as it is being redirected into corn.

Whether the US exports corn, wheat, soybeans - or burns its crops up as ethanol - either way it doesn't seem like food security is an issue.

[charliebrown]

Re: Ethanol subsidies in perspective

I have just started doing some research for someone interested in converting a fleet of cars to CNG.

Does this make sense?
From several web pages I have read, it seems to make sense.

The cost of converting a gasoline car to CNG seems not stratospheric like the plug in cars.
The premium for a factory delivered CNG car is not much more than gasoline.
The cost of the energy is less than gas.
The two main stumbling blocks seem to be the rarity of CNG filling stations, and the decreased cruising range,
due to the lower energy content of CNG.

Can we use some of the money we are using for ethanol to convert gas stations to CNG filling stations?
We have a chicken-and-egg problem here. No one will buy a CNG car if there are no stations, and no
stations are going to convert if there are few cars.

There is the one other stumbling block which is rather opaque. How much natural gas do we really have?
Is it 100+ years or is this an inflated number? I know EJ weighed in on this with his peak oil paper. It is approaching
2 years since the APSO conference do we have better estimates of the amount of nat gas we have. How are the
depletion rates for shale gas?

[thriftyandboringinohio]

Re: Ethanol subsidies in perspective

I have just started doing some research for someone interested in converting a fleet of cars to CNG.

Does this make sense?
From several web pages I have read, it seems to make sense.

The cost of converting a gasoline car to CNG seems not stratospheric like the plug in cars.
The premium for a factory delivered CNG car is not much more than gasoline.
The cost of the energy is less than gas.
The two main stumbling blocks seem to be the rarity of CNG filling stations, and the decreased cruising range,
due to the lower energy content of CNG.

Can we use some of the money we are using for ethanol to convert gas stations to CNG filling stations?
We have a chicken-and-egg problem here. No one will buy a CNG car if there are no stations, and no
stations are going to convert if there are few cars.

There is the one other stumbling block which is rather opaque. How much natural gas do we really have?
Is it 100+ years or is this an inflated number? I know EJ weighed in on this with his peak oil paper. It is approaching
2 years since the APSO conference do we have better estimates of the amount of nat gas we have. How are the
depletion rates for shale gas?

This link is a good place to start gathering credible info

http://www.nrel.gov/learning/avf_alternative_fuels.html

I wouldn't convert a car to CNG for two reasons. First, the fuel tanks are expensive, storing gas between 3000 and 5000 psi pressure -that's a big pressure. High pressure lines up to the 1st pressure regulator must also operate at that psi. Poor design or workmanship on these could kill somebody. That said, I've been involved in projects to convert vehicles to CNG, but we had teams of engineers and million dollar budgets, not shade-tree mechanics.

Second, there are few places to fuel them. A handful of stations scattered around test areas like Los Angeles and Washington DC. We ran ours in fleet service; they all came back to base every night and we had a fuel station there. If you look it up you might find you live in place that has stations. There was once a home appliance to compress the gas overnight in your garage called a fuelmaker; it might still be available.

I'd happily purchase a CNG car from an OEM or a major convertor. Years ago IMPCO in Ceritos CA did them. They left the gasoline tank in the car; added a CNG tank; installed a custom engine control computer; and could run on either gasoline or CNG.

If I was going to make a do-it-yourself conversion, I'd covert to propane. Low pressure fuel storage, and propane available in every city and RV park.

The chicken-and-egg problem you mention for fueling stations is widely recognized and usually called just that. It's the justification for taxpayer funded programs, to get some vehicles on the street to prove it works, and to set up a few fuel stations, and try to break the impasse.

[bill]

Re: Ethanol subsidies in perspective

Better get ready,,,big boys are coming.
Is that SWF's investing 3.5 Billion?

http://online.wsj.com/article/SB1000...googlenews_wsj

MAY 13, 2011
BEIJING—A consortium led by Temasek Holdings Pte. and including South Korea's sovereign-wealth fund paid about $3.5 billion for the 70% stake it bought this month in U.S. energy company Frac Tech Holdings LLC, people close to the deal said.

http://www.fractech.net/

[don]

Re: Ethanol subsidies in perspective

I found this guy useful for both an overview and cutting through the fog of alternative energy sources.

[c1ue]

Re: Ethanol subsidies in perspective

http://auto.howstuffworks.com/fuel-e...nol-facts1.htm

Ethanol is grain alcohol. In the United States, it's usually made from corn. In Brazil, it's most commonly made with sugarcane. Wheat, barley and potatoes are also sources of ethanol.
There are a couple of ways to make fuel-grade ethanol, and one of the most common ones is the dry-mill method, which goes something like this:

• The corn (or other grain) passes through a grinding meal. It comes out as a powder.
• A mixture made of this grain powder, water and an enzyme enters a high-heat cooker, where it's liquefied. The enzyme helps to break down the grain compound to aide in the liquefaction process.
• The liquefied mash is cooled, and another enzyme is added to the mix. This enzyme converts the starch into sugars that can be fermented to create alcohol.
• Yeast is added to the sugar mixture to begin the fermentation process. The sugars break down to ethanol (a form of alcohol) and carbon dioxide.
• The fermented mixture is distilled. The ethanol separates from the solids.
• A dehydration process removes water from the separated ethanol.
• A small amount of gasoline is added to the ethanol in order to make it undrinkable. All ethanol used as a fuel must be made nonpotable.

...

According to Cornell University professor of agriculture David Pimentel, producing ethanol actually creates a net energy loss. According to his calculations, producing corn and processing it into 1 gallon (3.7 liters) of ethanol requires 131,000 BTUs of energy; but 1 gallon of ethanol contains only 77,000 BTUs [source: Health and Energy]. And since farmers are using fossil-fuel-powered equipment to plant, maintain and harvest the corn and are using fossil-fuel-powered machinery to process that corn into ethanol and then, in almost all cases, to ship the product to collection points via fuel-powered transport, the ethanol industry is actually burning large amounts of gasoline to produce this alternative fuel. That ethanol could end up containing less energy than the gasoline consumed to produce it.



...


Of course that's just one pipeline. Even so, not all scientists agree with Pimentel's dire analysis regarding energy efficiency. *The U.S. National Renewable Energy Lab finds that it requires 1 BTU of fossil fuel to get 1.3 BTUs of ethanol to market [source: NREL]. That would mean a 30 percent net gain in energy, not a net loss.

So, according to the NREL - 1 gallon of gasoline or fossil fuel equivalent in BTUs would yield roughly 2 gallons of ethanol.

However, the 2 gallons of ethanol releases both the fossil fuel carbon dioxide (in energy generation) plus additional CO2 from the ethanol process itself.

Gasoline burn produces 8.8 kg CO2/gallon
Corn Ethanol burn produces 5.3 kg CO2/gallon

http://m3challenge.siam.org/pdf/Team_175_Wheeler.pdf

Seems like the CO2 savings is slim to none.

[gwynedd1]

Re: Ethanol subsidies in perspective

Hi thrifty,

You are denying the premise of the article that it takes just as much oil to produce ethanol. So nothing runs on corn from the stand point of surplus energy. We do have domestic oil so we would already run more than a small fleet as it is not to mention natural gas.

[thriftyandboringinohio]

Re: Ethanol subsidies in perspective

Hi thrifty,

You are denying the premise of the article that it takes just as much oil to produce ethanol. So nothing runs on corn from the stand point of surplus energy. We do have domestic oil so we would already run more than a small fleet as it is not to mention natural gas.

No denial about the losing thermodynamics of ethanol - more energy goes in than comes out.

And back to my original post, Archer Daniels Midland and the American Corn Growers Association are pushing ethanol for their own monetary gain.

[Ghent12]

Re: Ethanol subsidies in perspective

5) growing corn for ethanol causes starvation in the third world:

this one makes my head swim. Is it really the case that paying farmers to keep their crop off the market ( proving subsidies to turn food into ~10% of US fuel) is the cause of third world starvation? In the absence of government policy supporting corn prices would they fall to a level low enough to feed every hungry mouth? Let me throw this one out there. Can anybody explicate the logical fallacy with this argument?

As c1ue stated, this is plainly seen for what it is.

People on the margin are most vulnerable to even small fluctuations in price. Those millions of unfortunate individuals who have only a marginal access to food indeed starve to death as a direct and irrefutable result of policies which artificially reduce the supply of food (essentially anywhere). It's the same reason why higher taxes or other artificial interventions can kill companies that are on the margin of profitability. It is a clearly understood causal relationship and there is no need for hyperbole strawmen.