The Alcohol Cure - How to break the oil monopoly in this decade.

National Review Online ^ | December 13, 2007 | Clifford D. May

[businessprofessor]

There is no comparison. The primary subsidies to ethanol are mandates about the amount of ethanol blended in the fuel supply. The energy bill passed by the Senate would significantly increase the mandate. Ethanol also receives subsidies through no fuel taxes and import tariffs on Brazilian ethanol.

The oil industry pays large amounts of taxes at every stage in production. I am not sure what forgiven royalties to which you refer. The rats have complained for years that the Clinton administration made some bad deals on oil leases. These deals were made to encourage exploration and development when the oil price was low. The rats simply want to disregard valid contracts, essentially taking property from the owners of the oil companies.

The leases should be auctioned so that the owners have property rights. The government should not be in the business of granting leases.

[Mr. Lucky]

OK, if the government is not in the business of granting leases, who grants leases for production on public property?

[businessprofessor]

the mineral rights could be auctioned just like the broadcast airwaves.

[Mr. Lucky]

They could be, but they aren’t. The fact that the corrupt, royalty free, contracts were entered into during a Democrat administration doesn’t make them any less of a subsidy. just as the accelerated depletion allowances, deduction of development costs, socialization of environmental expenses, and the like are subsidies.

[timer]

Let’s take a wider view : basically this is an energy AREA vs VOLUME argument. Corn(ethanol)/timber(methanol)take up huge AREAS that have to be planted/tended/harvested whereas coal/nuc/hydro-dams are concentrated into tiny VOLUMES, area goes up as the square, volume as the cube. Thus the inherent difficulty of an annual AREA harvest vs the VOLUME harvest of concentrated sources.

Take solar for example. Yes, it’s EASY to calc that 10,000 sq miles of SW desert(100 mi x 100 mi)is enough to supply all the electric needs of the country. But what is the sqft cost to build/maintain your solar farm? At $10/sqft for mfgr/install and 5280 x 5280 x 10,000 = 2.7878 x 10^12...that’s a lot of CASH...midst all the OTHER energy approaches/interests. Now do you see why solar as AREA will never make it?

Then there’s governments, fed and state, that make BUCO BUCKS on fuel taxes; that’s one of their main cash cows and thus VESTED INTERESTS in keeping the system just as it is. Zubrin’s ethanol concept is a non-starter until the VESTED INTERESTS are dealt with first.

Also, every BTU as electricity you use in home heating requires about 3 BTU back at the coal fired plant to get that BTU to your electrical panel(thermodynamic inefficiencies, transmission line losses). Thus adding INSULATION, say doubling what you have now, would have a far greater impact than any energy SOURCE you can name.