Agreed, and ethanol is only cheaper at the moment because gasoline is so expensive.
Ethanol of course depends on the cost of corn and natural gas. It is generally but not always cheaper than gas, right now by a fair amount.
There’s the subsidy and mandate problem for sure. It is less BTU’s but is priced cheaper to compensate. It destroys older engines but that will disappear in time. Those are a big deal, but my biggest problem is what it does for the farm sector.
Yes, it does raise the price of corn. There’s a limit there though, too expensive and it’s no longer profitable to make ethanol because it costs more than the price of gas with less BTU’s. That ties corn price to the price of gas which is highly variable and unpredictable. Not what a farmer wants.
But say gas prices are high enough not to be affected at that time by high corn prices. The problem is the farmer burns gas and diesel to grow and harvest corn. Yeah corn prices are good, but input costs are high, profit margins crap.
What’s the gain for the farmer? Not much in the long run. There is more in grain besides fermentable carbs, there’s protein, oil, and various other valuable substances. The excessive focus on ethanol, propped up by the govt, is crowding out these other opportunities from seeing the light of day. Opportunities that don’t suffer from a love-hate relationship with gasoline.
The ethanol thing is near the end of the road and there’s no future in it because the demand for corn is outstripping supply as ethanol use rises. We need to diversify to decouple from the delicate dance the ethanol industry, and thereby farmers, have to constantly do. Farmers will be better off, we’ll be better off.