Tag Archives: ethanol

EPA to trim ethanol requirements after realizing threat to fuel supply

For the first time in history, the EPA has backed off its requirement to pump as much corn into the fuel supply as possible.

Corn growers and ethanol refiners are balking at the rule as they will certainly see reduced demand for their products, but fuel refiners are cheering the decision stating that if the mix requirement had been left as Congress demanded, fuel supplies would have been unstable and many vehicles would have been exposed to expensive repairs and intolerable fuel economy.

This year, fuel producers would have been required to blend 15.2 billion gallons of corn ethanol into gasoline – a ratio that would have endangered the entire fuel supply.

Instead, 13.2 billion gallons of food-based fuel additives will be burned in vehicles.

Corn ethanol also pushes food prices to ridiculous levels. People eat corn, pigs (pork) eats corn – lots of other things eat corn. Burning corn in gas tanks to appease a smattering of global warming zealots makes no sense.

When Americans realize that the food on their table is more important than a fantastical theory that somehow man can overpower the planet, normalcy may be restored.

Chicken wings for Superbowl more expensive due to government policy

Chicken wings get more expensive due to Obama policies

Chicken wings get more expensive due to Obama policiesYou’re getting ready for Superbowl Sunday and head to the grocery store to get some chicken wings, a traditional football food, and see that prices are not what they used to be. It isn’t because of simple inflation, it’s because the White House pushed for policies that made chicken much more expensive for farmers to produce.

The National Chicken Council has announced that chicken meat prices are rising quickly due to Obama administration policies requiring up to 40% of the corn food supply to be turned into fuel for cars.

The White House pushed for E15, a gasoline mixture that requires much more corn-based ethanol in gasoline. Unfortunately, corn is also used to feed chickens. By creating competition between food producers and fuel refiners, the cost of corn has risen to a point that major chicken farmers could not afford to produce as many chickens. Supply-demand – same demand, decreased supply = chicken costs more.

What’s worse is that the new E15 fuel causes major issues with cars’ fuel systems. The increased ethanol turns into a system-fouling gelatinous mess. Fuel pumps, hoses and other components expand, gum up or otherwise become inoperable due to ethanol’s inherent instability. Enjoy that tow truck bill after sitting on the highway for hours…

Naive energy policies are not only causing Superbowl Sunday celebrations to cost much more than they should, but will likely cost many Americans to pay car repair bills they were not expecting.

 

The RFS Ethanol Mandate – and the Drought

ethanol

A federal tax credit for ethanol, created more than 30 years ago, expired on Saturday, December 31, 2011. During the past more than 30 years, the federal government provided more than $20 billion in subsidies for the use of ethanol. Most U.S. ethanol is produced from corn.

That’s all well and good, but…subsidies (in the form of tax credits) for ethanol may have ended, but there is this little something called the “Renewable Fuel Standard” (RFS), created while George W. Bush was president, as part of the Energy Independence and Security Act (EISA) of 2007. The Obama Environmental Protection Agency (EPA), under administrator Lisa Jackson, has decided to continue it.

For further perspective, Aaron Smith, at The American, the online American Enterprise Institute magazine, on January 4, 2012, wrote:

So why did the powerful corn ethanol lobby let it expire without an apparent fight? The answer lies in legislation known as the Renewable Fuel Standard (RFS), which creates government-guaranteed demand that keeps corn prices high and generates massive farm profits. Removing the tax credit but keeping the RFS is like scraping a little frosting from the ethanol-boondoggle cake.

So the RFS takes up the profit slack lost when the ethanol tax credit subsidies were ended.

The “Standard” calls for the EPA to be “responsible for developing and implementing regulations to ensure that transportation fuel sold in the United States contains a minimum volume of renewable fuel.” That means that farmers will continue to devote large quantities of land to Greenhouse Gas (GHG)-intensive corn, the kind used to make ethanol.

For comparison, in 2005 (before the mandate), corn was selling for $2 per bushel, and 1.6 billion bushels of corn, about 13 percent of the crop, was converted into ethanol. Today the price is over $8 per bushel, and the RFS mandate calls for over one third of the crop be converted into ethanol.

According to Aaron Smith, “The RFS mandates that at least 37 percent of the 2011-12 corn crop be converted to ethanol and blended with gasoline.” Smith continues: “The RFS mandate requires a massive quantity of corn to be converted to ethanol each year regardless of price or available supply.”

The Congress Budget Office (CBO), in July 2010, wrote, “… the scheduled increase in mandated volumes would require biofuels to be produced in amounts that are probably beyond what the market would produce even if the effects of the tax credits were included.” Demand for corn-based ethanol is driven by the RFS mandate. The tax credit that expired at the end of 2011 hardly made a difference.

As Robert Brice at Slate writes, there is no doubt that the corn ethanol mandate is distorting the market. Most corn is used not as food for humans, but as livestock feed. That fact means that prices for human food, from milk to cheese to eggs to meat, will increase as a result of the RFS mandate. America’s corn to ethanol process now consumes about as much grain as all of the US’s livestock.

The U.S. is currently exporting large quantities of corn ethanol to, of all places, Brazil. Yes, that is the same Brazil that accepted money and technology for “environmentally responsible” oil exploration from the US, then signed contracts with China for the oil.

The RFS mandate is bad enough, but now farmers nationwide are feeling the effects of the drought. The USDA has yet again downgraded the condition of U.S. corn crop, saying that only 26 percent of it is in “good” or “excellent” condition, down from 31 percent the week before. Iowa farmer Chris Barron says his “corn and soybean crops will likely generate yields 7 percent to 10 percent below what he estimated” due to the fact that the Midwest has received about 0.94 inches of rainfall so far in June, or about 20 percent of the 30-year average for the month.

Colin Carter, a UC Davis agriculture economist, said, “The ethanol policy is a bad idea because the impacts of a drought are much more severe than it used to be.”

Drought concern started a Chicago Mercantile Exchange (CME) Group grain markets price rally, sending corn futures up over 60 percent since mid-June 2012, and the price per bushel as high as $8.20. As of August 7, 2012, Iowa was, according to the U.S. Drought Monitor, suffering from severe to extreme drought. Illinois, the second-most prolific corn-producing state after Iowa, was in extreme to exceptional drought. Moderate to exceptional drought also affected most of Missouri, Indiana, Kansas, and Nebraska.

A less than expected corn crop will leave supplies low, raising questions over the ability of the U.S. to keep pace with growing worldwide demand. Jason Britt, president of Central States Commodities, Inc., based in Kansas City, MO, said, “There’s ‘almost zero’ chance the corn crop achieves the USDA’s current nationwide yield forecast of 166 bushels an acre. Given drought damage, the crop probably will drop below 160 bushels an acre, and perhaps to the low- to mid-150s.” As Aaron Smith commented, “Low corn stockpiles place the worldwide market in a perilous position. If the 2012 US crop is even slightly smaller than expected, corn prices will rise even further and plunge millions more people into extreme poverty.”

Corn ethanol producers would reduce their use of corn in the ethanol process in response to higher food and feed prices (demand) if they were unconstrained by the RFS mandate (see Figure 3, page 35).

Several senators and representatives who represent livestock producers and dairy farmers are willing to suspend the corn portion of the mandate, but they want the cellulosic ethanol part of the mandate enforced. But there is one small problem with that idea: cellulosic ethanol does not exist.

Now we find that eight biofuels groups are forming a coalition to fight calls to limit a federal mandate for renewable fuels. The call to suspend the mandate is caused by the drought. Advanced Biofuels Association, Advanced Ethanol Council, Algal Biomass Organization, American Coalition for Ethanol, Biotechnology Industry Organization, Growth Energy, National Biodiesel Board, and Renewable Fuels Association make up the coalition.

Add to the above the problems caused by the transportation, storage, and use of ethanol, and there is the makings of a real catastrophe. Ethanol and gasoline-ethanol blends “cannot be transported by gasoline pipelines” because water in the pipelines causes the ethanol to separate from the gasoline. Ethanol must be transported by its own independent distribution system. It is blended with gasoline just before delivery to retail stations. And engine ignition is “more difficult in colder weather for vehicles running on fuels with high ethanol content” because of ethanol’s lower vapor pressure.

As Aaron Smith says, “It is time for the federal government to stop requiring cars to burn food.” But I suppose that the Obama EPA would rather continue its RFS mandate than tell the truth about fracking, or about Obama’s war on “Big Oil.”

And let’s not forget George W. Bush’s part in this situation. It was he, after all, who got the ball rolling.

But that’s just my opinion.

Please visit RWNO, my personal web site.

Iowa GOP Losing Interest In Subsidies

The long-standing “sacred cow” of Iowa politics may not be sacred anymore.

From The Iowa Republican:

A recent survey of likely Republican caucus goers shows that support of federal subsidies for the ethanol industry has waned significantly in recent years. The poll, which was commissioned by TheIowaRepublican.com, finds that Iowa Republicans view a candidate who supports ending federal ethanol subsidies more favorably than a candidate who doesn’t.

The survey asked, “Some of the candidates have proposed to end federal subsidies for ethanol. Do you have a very positive, somewhat positive, somewhat negative, or very negative reaction to candidates taking this position?” Forty-seven percent responded by answering very or somewhat positive. Only 24 percent of respondents said that they had a negative reaction to a candidate who is campaigning against ethanol subsidies.

This is quite a change from previous Presidential election years.

Paul Abrams at The Huffington Post doesn’t appear to have gotten the memo:

In the circus masquerading as the Republican Iowa caucus, there has been nary a word about ethanol subsidies, a major issue for Iowans.

But, where do these budget-cutting, waste-fraud-abuse claiming, shrinking-government demanding, laissez-faire extolling candidates stand on ethanol subsidies? The subsidies have been around a long, long time.

Consider the implication of this change in Iowa: The biggest obstacle to cutting government spending has been the “public trough” effect- the notion that voters would resist cutting excessive spending immediately beneficial to themselves. This effect has been particularly strong in Iowa, where ethanol subsidies were considered so sacred that every Presidential candidate had to publicly favor them or throw away any chance of success in that state.

We all know the left counts on this lack of self-deprivation as a safeguard against serious budget cuts. If Abrams’ comments are any indication, the prospect of Iowans adopting some measure of self-discipline with regard to federal taxpayer dollars terrifies the left.

E.P.A. Oversteps Regulatory Authority on Auto Fuels – Groups File to Overturn

Petroleum industry to file suit against EPA on e15 ethanolThe National Petrochemical & Refiners Association joined with the International Liquid Terminals Association and the Western States Petroleum Association to file a law suit intended to overturn a recent regulatory overreach by the Obama Administration.

The E15 Proposal and Granted Waiver

In March of 2009, Growth Energy and several other alternative fuels organizations petitioned the EPA to have E15 introduced for use in vehicles not specifically modified to deal with the caustic nature of ethyl alcohol (ethanol).  In October, the Environmental Protection Agency bowed to the corn-to-fuel lobby and granted a partial waiver allowing for the use of E15 (15%) ethanol fuels in all vehicles newer than 2007.

Misfueling, the accidental fueling of a vehicle with the incorrect fuel, is a serious concern.  The cost to repair a fuel system once ethanol has done its damage is considerable.  The EPA web site mentions that they are working on a way to reduce misfueling, but they aren’t holding this waiver until that solution is drawn up.

..the EPA is concurrently issuing a proposed rule with the express purpose of reducing the potential for misfueling of E15 into vehicles, engines, and products for which it is not approved.  If finalized, this rule will satisfy the misfueling mitigation conditions of today’s partial waiver.

The Next Step for the EPA is Older Vehicles

The EPA waiver also discusses 2001-2006 vehicles.

EPA is deferring a decision on MY2001-2006 light-duty motor vehicles.  DOE is in the process of conducting additional catalyst durability testing that will provide data regarding MY2001-2006 motor vehicles.  The DOE testing is scheduled to be completed by the end of November 2010.  EPA will make the DOE test results available to the public and consider the results and other available data and information in making a determination on E15 for use in those model year motor vehicles.

Problems With Ethanol 15 and higher

Only catalyst durability testing?  That will only prove whether or not the fuel is stable.  What about engine durability testing?  While ethanol’s instability is certainly a concern, fuel system components made for gasoline do not react well with corn-alcohol (ethanol).  A 50% increase in the amount of ethanol in fuels will cause failure of fuel hosing, pumps, seals and possibly injection/carbeuration.   An article at Hagerty.com relays the problem that ethanol presents to older vehicles:

  • Corrosion caused by contact between two dissimilar metals when the metals are in contact with an electrolyte, like ethanol. It looks like this.
  • Rubber components like fuel hoses, carburetor seals and gaskets, and fuel pump seals may be hardened, dissolved or distorted by contact with ethanol. This may lead to fuel leaks.
  • Ethanol holds water very readily and can expose fuel system components and steel gas tanks to rust. This is especially prevalent in boats.
  • Even low concentrations of ethanol have been shown to damage fiberglass fuel tanks. Ethanol dissolves the lining of fiberglass fuel tanks, often depositing a dark “sludge” inside marine engines causing costly damage. Eventually, fiberglass tanks dissolve until they fail, leaking fuel.
  • Metal parts, such as in-tank fuel pumps and carburetor floats, may be subject to pitting, rust or corrosion when in contact with ethanol blends.

The only way to prevent this damage is to replace fuel system components with ethanol-safe parts or buy a newer vehicle with the flex-fuel designation.  Either way, Americans will be yet again saddled with the cost of the progressive agenda.

Having to upgrade your fuel system or buy a new car are expensive enough, but even according to the government site FuelEconomy.gov it’s evident that higher ethanol content will also have you paying even more for a gallon of fuel.

FFVs experience no loss in performance when operating on E85. However, since ethanol contains less energy per volume than gasoline, FFVs typically get about 25-30% fewer miles per gallon when fueled with E85.

So your 30 mpg turns to 20-23mpg on E85.  Perhaps you only lose 3-4mpg with E15, but that’s after you just spent money to upgrade your fuel system or the entire car.  Upgrade costs, lower mileage, and it will further increase the price pressure on corn as more corn fields are turned into fuel.  That means the less-efficient, fuel-system destroying fuel will also cost more.

The Suit Against the EPA

It would be easy to look at the petroleum industry’s suit as a special interest protecting their profits.  If that’s the position taken than one must also agree that Green Growth and tons of other corn-to-fuel businesses lobbied the EPA to put this waiver in place.  It’s one fuel provider against another.

The real concern should be how the waiver was obtained.  At least the petroleum industry lawyers are attacking the proper problem, regulatory overreach.  While those involved in the suit will file written arguments in coming weeks, they had this much to say in a January 3rd press release:

NPRA and the other organizations today filed a petition asking the U.S. Court of Appeals for the District of Columbia Circuit to review and overturn the EPA decision, contending EPA violated the Clean Air Act and the Administrative Procedure Act.

The lawsuit by the groups will argue that EPA does not have authority under the Clean Air Act to approve a partial waiver that allows the use of E15 in some engines but not in others.

In addition, the lawsuit will contend that EPA based its partial waiver decision on new data submitted to the public rulemaking docket on the day before EPA announced the partial waiver, providing no time for the stakeholder review or meaningful public comment required under the Administrative Procedure Act.

This is exactly the same kind of circumvention of American law and process that the FCC used to put it’s tyrannical control of the internet in place.  Perhaps the courts are the last hope to protect American citizens from a government bent on even more control.

Ethanol: What They Aren’t Telling You

Most information on Ethanol presents the corn-based fuel as a panacea for the worlds pollution woes, a green-jobs creator, and a needed boost to American farmers.  Digging into these claims brings some interesting data points to the surface.

The American Coalition for Ethanol touts ethanol as:

..a high octane, clean burning, American-made renewable fuel. Its production and use offer a myriad of benefits to the United States and its citizens.
The production of ethanol is an economic engine for the United States, adding value to U.S. agricultural products and bringing billions of dollars to the nation’s economy each year. The use of ethanol reduces harmful auto emissions, offers consumers a cost-effective choice at the pump, and decreases the amount of expensive crude oil needed to satisfy the nation’s thirst for transportation fuel.

Wow, sounds great doesn’t it, like the energy holy grail, until you dig into ethanol itself.  Examining the ethanol production process is somewhat revealing.

The number one crop used for Ethanol is corn. Uh-oh- now we have to divert corn to become our new Gasoline, but is there enough Corn?

The USDA Economic Research Service about corn:

  • Corn is the most widely produced feed grain in the United States, accounting for more than 90 percent of total value and production of feed grains.
  • Around 80 million acres of land are planted to corn, with the majority of the crop grown in the Heartland region.
  • Most of the crop is used as the main energy ingredient in livestock feed.
  • Corn is also processed into a multitude of food and industrial products including starch, sweeteners, corn oil, beverage and industrial alcohol, and fuel ethanol.
  • The United States is a major player in the world corn trade market, with approximately 20 percent of the corn crop exported to other countries.
  • ERS analyzes events in the domestic and global corn markets that influence supply, demand, trade, and prices.

That means that all of our corn is already in high demand in everything from Aspirin, to cereals, to livestock feed. If Ethanol replaced motor vehicle fuel, the principles of supply and demand would force almost all corn produced to be diverted to Ethanol production. This would skyrocket the price of all corn-dependent products including livestock fed from corn unless they find an alternative.

According to the Cato Institute in a January 2008 report titled “Food Fight” Ethanol has already had an affect on our economy.

The ethanol boom has knock-on effects in the rest of the rural economy. The growing use of cereals, sugar, oilseed and vegetable oils to produce ethanol and biodiesel is supporting crop prices and, indirectly through higher animal feed costs, raising costs for livestock production. As Table 1 shows, the prices for poultry, beef, and eggs have all increased by more than 5 percent this year. (Pork prices have risen relatively slowly because production has been very high compared to demand, although producers are expected to lower production during 2008 because of losses from low prices and higher feedcosts.[12]) Farmland prices in key corn-growing states such as Iowa, Nebraska, and South Dakota have increased by more than 20 percent in the last year.

So thats the economic impact, Choose between corn-dependent products or driving – you can’t afford to do both.

According to Elsa Steward in her article “What’s Wrong with Ethanol?” She points out that Ethanol by itself is not cost effective.

Ethanol is not likely to give us any relief from high gasoline prices. A gallon of gasoline produces about 1.5 times more energy as a gallon of ethanol. Because of this lower energy density, ethanol production and transport requires more production and transport capacity than gasoline. Ethanol also absorbs water, which is present in existing pipelines. Ethanol cannot be transported in these pipelines because the water would dilute the ethanol. The ethanol must therefore be carried over land by train or truck, a more expensive means of moving the ethanol from one place to another. Although the price of motor fuel sometimes increases due to problems with foreign and domestic oil supplies, the price of ethanol has historically been higher than gasoline prices and may remain higher for some time to come.

The Department of Energy’s Genomic Science Program

  • Can one gallon of ethanol displace one gallon of gasoline?
    • No. Ethanol has about 70% the energy content of gasoline per unit volume, so for every gallon of gasoline consumed, 1.4 gallons of ethanol would be needed to displace it. Ethanol, however, has a higher octane rating than gasoline — about 113 for ethanol compared to 87 for regular gasoline. The higher the octane rating, the better a fuel is at preventing engine “knocking” caused by inefficient fuel combustion. In other words, the higher-octane fuel provides better performance because it is used more efficiently to generate power rather than heat. If engines were optimized to take advantage of the higher octane rating of ethanol, they could achieve fuel economy more similar to that of gasoline engines.
  • Can ethanol be used by existing fuel-distribution infrastructure?
    • Ethanol and gasoline-ethanol blends cannot be transported by existing pipelines that carry gasoline. Water present in petroleum pipelines can pull ethanol out and cause ethanol-gasoline blends to separate into two phases. Ethanol must be transported by train, barge, or truck within an independent distribution system to ensure handling separate from the ethanol-production facility to distribution terminals, where ethanol is blended with gasoline just before delivery to retail stations.
  • Can ethanol be used in colder northern U.S. climates?
    • Due to ethanol’s lower vapor pressure, engine ignition is more difficult in colder weather for vehicles running on fuels with high ethanol content. During winter months, gasoline is added to E85 (85% ethanol and 15% gasoline blend) to make E70 (70% ethanol and 30% gasoline), which has a vapor pressure that improves starting in cold weather. Although current practice is to “blend-down” E85, the cold-start issue is a technologically solvable engineering problem for vehicle manufacturers.

I can’t afford a bowl of cereal, probably can’t afford to get very far in my car, if I’m up north, I can’t drive in the winter and ethanol has to be trucked in which means it burns more ethanol to get ethanol. But wait theres more. If you act now on this “Clean-Burning” fuel we will include free pollution with every purchase.

Oh gee did we leave that part out? So sorry, ethanol is not “clean burning” nor is the process to make it.

From Gas2.0

The Des Moines Register reported the other day that Iowa’s ethanol plants contribute 15 Percent — 7.6 million metric tons out of a total of 52 million metric tons — of greenhouse-gas emissions found in the state’s new inventory of major manufacturers, businesses and power plants
Iowa’s Department of Natural Resources found that the largest portion of the state’s overall emissions came from fermenting grain at the plants and not from burning natural gas or coal. In addition, burning biomass such as switchgrass at various industrial plants added another 0.13 million metric tons.

Uh-oh Ethanol production produces more greenhouse gas than coal plants, not very clean is it. Imagine the effect Cap & Trade would have on this industry. Lets just say you’ll be better off with a bicycle.

But I digress, lets look at the burning of Ethanol itself.

The Environmental Working Group (EWG) fought against the EPA granting Ethanol a Clean Air Act waiver for an increase from the 10% Ethanol Gasoline to increase from 15% to 50% (Note now its 10% Ethanol and 85% Ethanol) in May of 2009 due to, among other reasons, Ethanol production’s propensity to “degrade water quality, worsen emissions of some air pollutants and escalate health risks for children and other vulnerable people, according to scientific studies by the Department of Energy, Department of Transportation Pipeline and Hazardous Materials Safety Administration, National Research Council, independent academic researchers and EPA scientists”

An environmental watchdog group is telling us that increasing the amount of ethanol used will increase air pollution and lead to health risks based on Government studies, and yet its that same Government trying to force it upon us.

In short, widespread use of ethanol only creates more problems than it is supposed to solve. IIt is not the holy grail of green energy, if anything its more pollutive than standard fossil fuel use.

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