Environmental Outlook: Declining Political Support for Ethanol

Environmental Outlook: Declining Political Support for Ethanol

The U.S. produces more than half the world’s ethanol. Yet, the once strong political support for the bio-fuel is, for the first time, showing signs of waning. As part of the Environmental Outlook series we discuss why an industry that was once the darling of the renewable energy sector seems to be falling out of favor.

America’s ethanol industry is booming. The U.S. is projected to become the world’s biggest ethanol exporter by the end of the year. In the past, Congress has strongly supported the industry. Now it seems to be losing its enthusiasm. The catalyst is not long-standing doubts about its green credentials, or concerns that government intervention is distorting the market. Instead, as farming communities prosper while the rest of the country tries to stave off a recession, subsidies for the industry seem increasingly hard to defend. As part of our Environmental Outlook series we ask whether ethanol can retain the broad political support it has enjoyed for so long.

Guests

Bob Dinneen

president, Renewable Fuels Association

Sheila Karpf

legislative and policy analyst, Environmental Working Group

Chuck Abbott

commodities reporter, Reuters

Program Highlights

The U.S. produces more than half of the world's ethanol, yet the once strong political support for this bio-fuel is, for the first time, showing signs of waning. why does an industry that was once the darling of the renewal energy sector seems to be falling out of favor?

What Could Replace Ehtanol?

With technological and economic problems adding up for ethanol production, our guests discussed what alternatives to ethanol we should be considering. "We need to invest more in public transportation. We need to look at how to reduce gasoline consumption overall and increase energy efficiency. And we've also talked about putting money towards investment and research in truly advanced bio-fuels that reduce greenhouse gases, don't compete with the food supply, etc," said Sheila Karpf from Environmental Working Group.

The Political Climate Surrounding Ethanol

Chuck Abbott, Reuters News: "Probably the most consequential day for ethanol policy this year was June 16. That was the day the senate voted 73 to 27 to cut off the excise tax credit for ethanol. And on the same day the House was voting on the agriculture appropriations bill and it voted 283 to 128 to prohibit the agriculture department from using any of its money to install blender pumps." (Blender pumps are fuel pumps that can dispense mixtures of ethanol and gasoline up to 85 percent ethanol).

Concern About Ethanol Subsidies in an Era of Deficit Problems

The ethanol industry came forward earlier this year to say that they don't feel they need the federal subsidy in the form of tax credits. Bob Dineen, Renewable Fuels Association: "We said, you know, let the tax incentive expire. We do think that there are other things that the government ought to do in terms of encouraging investment in infrastructure and allowing investments in new technologies, new feed stocks to go, allowing the evolution of the industry to continue."

Ethanol and Food Supplies

According to Dineen, the corn that is used to produce ethanol is not suitable for food consumption. "We are only using the starch from that corn. What is left behind is a very high value, high protein feed that is then used to feed cattle, feed poultry, feed hogs and is adding to the feed supply." But Karpf disagreed: "We are currently using 40 percent of our corn crop for ethanol production...here in the U.S. we only spend about 10 percent of our income on food, but in developing countries that can be anywhere from 50 to 70 percent of their income being spent on food. And so even a small price increase for corn, wheat or other crops can make or break whether families are feeding themselves."

You can read the full transcript here.

Comments

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as mechie and techie, for you and caller, a drastic change in MPG due to other cause

gradual decrease MPG- airfilter, tires, loss compression(faster if following no check/ change oil level philosophy)

drastic change- new tires, improper maintenance, flat tire(have seen people riding flats), pc failure

if program for poor peoples autos ENACTED

tax revenue up employment up, energy savings UP

but that would be socialisticommunistiantiamericanism or theology... helping US help the less fortunate...

October 4, 2011 - 1:19 pm

Soylent Green

future fuel for body and soul

October 4, 2011 - 1:20 pm

We don't grow enough sugar cane in the US to make a dent.

October 4, 2011 - 5:27 pm

As an employee of Novozymes, a biotech company and provider of enzymes to the biofuels industry, I want to share some info with everyone that you may not know: 1) It takes 1 gallon of petroleum to make 12 gallons of ethanol; it takes 1 gallon of petroleum to make .476 gallons of gasoline (per U. of Nebraska study.) 2) The EPA conducted extensive testing of cars/trucks over the course of a year and approved models 2001 and newer to run on an E15 blend with no problems. This does not take into account small engines/motors, but no one is forced to use E15 - it is an option. 3) Animal feed is still being created and sold through the ethanol production process and it provides even higher quality nutrients to feed the animals than straight grain. Grass-fed livestock is best for human health anyway. Scores of medical studies show that grain-fed livestock is a large part of why America has a growing health epidemic - due to the continuous state of inflammation it puts our bodies in. 1 ton of distillers dried grains has enough nutritional content to replace 1 acre of soy. So tell me now where is the loss of food? 4) The price of corn is being driven by speculation and weather events -- not biofuels. The price of corn in your food is almost inconsequential - more of the price is related to transportation costs (read oil/gasoline), marketing, packaging and profits! 5) U.S. farmers are producing more corn than is demanded by markets for food, feed and fuel, with exports and ending surplus of corn remaining steady, if not increasing while using less land than in previous years. 6) Corn ethanol plants of today reduce GHG's by up to 60% and advanced biofuels (such as cellulosic ethanol made from trash, corn stover/cobs, energy crops or other forest/ag residues) can reduce GHG's by up to 90% vs. gasoline. What's more important? Saving our planet for our children? or your gas mileage? Please inform yourself and check sources and facts - do not believe all that you hear.

October 4, 2011 - 6:45 pm

Durbin and Obama bent over for the corn lobby, enough said.

October 4, 2011 - 8:49 pm

I, too, am disappointed with WAMU coverage of ethanol. Money and special interests have combined to create a web of myths about ethanol which is difficult to unravel. This program was no help in this matter. All but two comments (cssetzer and Paigedonnelly) were largely uninformed or misinformed. It has been know for over a hundred years that engines designed to run on ethanol are more efficient with higher performance than those designed to run on gasoline. For a historical background of how we got to where we are today, read "The Forbidden Fuel" A History of Power Alcohol.

October 6, 2011 - 12:46 am

Paige Donnelly raised some interesting facts related to the 'food for fuel' controversy. This needs to be put into historical context. About 40 years ago, the US adopted an agriculture policy that subsidized corn and exported it at below cost of production. This eventually put many farmers in developing countries out of business. Reinvesting in these farmers should be the priority for combating world hunger, not continuing past bad practices. The development of the corn ethanol industry brought a new market that has basically eliminated corn support payments which topped $20 Billion dollars only a few years ago. Because corn was so cheap, it was used to feed cattle and hogs not because it was a good diet for them. The meat industry got used to this indirect subsidy and is now crying the blues. Cattle particularly, because they are a ruminant animal can't handle the high starch of a corn diet and require antibiotics to keep their digestive tracks functioning. DDGs from distillation of ethanol are a much better diet being used in a ration proportion of 1 lb. of DDGs replacing 1.3 -1.4 lbs. of corn at abut 85% of the cost per pound. It also reduces the time on the feed lot to market weight by about 8%.

October 6, 2011 - 12:49 am

Many people believe we should feed the corn to the cattle and use the stover to make cellulosic ethanol. This is not proving itself as a rational approach for animal feed and fuel. The cobs are fine for ethanol conversion, but the stalks are like sponges and moisture content can vary greatly hindering conversion to fuel. The stalks also contain some lignin which is a problem in conversion to fuels. Cattle, being ruminant animals are designed to digest cellulose (grass) but not wood like plants. ADM, based on research done by the Cox experimental farm in Ohio in the 50's, is advancing the use of corn stocks after a 'pretreatment' as cattle feed leaving the corn seed for industrial purposes. This pretreated 'stover' used with DDGs and maybe a bit of corn will result in healthier cattle at lower feed costs and healthier people. An ethanol producer, Green Plains, is using waste CO2 from distillation to grow algae which they are presently targeting as an additional animal feed resources. It has also been suggested that the use of the 'waste' thin stillage can be cleaned by using it as a medium to grow fungi that are then used in the animal feed cycle (mainly aimed at hogs).

Without an understanding of history and a forward looking understanding of the inter-related process of food AND fuel, we will be hopelessly mired in myth and fantasy.
Bill Brandon

October 6, 2011 - 12:50 am

The Diane Rehm Show is produced by member-supported WAMU 88.5 in Washington DC.