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Senate Approves Ethanol Mandate for Gasoline as Part of Energy Bill
Environmental News Network ^ | June 16, 2005 | H. Josef Hebert

Posted on 06/17/2005 11:52:00 PM PDT by hedgetrimmer

WASHINGTON — The Senate on Wednesday endorsed a broad expansion of the use of ethanol in gasoline, despite claims by opponents that it would force up gasoline prices outside the Farm Belt and reduce fuel economy.

A provision that requires refineries across the country to use a total of 8 billion gallons of ethanol a year -- double today's production -- beginning in 2012 was approved 70-26 and put into a wide-ranging energy bill the Senate is expected to complete in the next two weeks.

An attempt by Sen. Charles Schumer, D-N.Y., to strip away the provision failed, 69-28. Schumer called the requirement to use ethanol in gasoline nationwide "nothing less than an ethanol tax levied on every driver" and a "boondoggle" to benefit farmers at the expense of motorists.

Opponents, mainly from the West and Northeast, said ethanol should not be required in states where it is not needed to reduce air pollution and is not readily available. Most ethanol is produced in the Midwest.

Supporters of the measure said ethanol -- made almost exclusively from corn -- is a way to reduce demand for foreign oil and boost U.S. energy security.

"We must take steps to reduce our dependence on foreign countries," said Majority Leader Bill Frist, R-Tenn. Farm-state senators -- both Democrats and Republicans -- said ethanol-blended gasoline would allow homegrown energy to replace some imported crude oil.

The ethanol industry claims that 8 billion gallons of ethanol -- used at up to a 10 percent blend -- would allow refiners to use 2 billion barrels less crude oil per year. That assertion has been challenged by the oil industry, which has said use of ethanol would have a negligible impact on oil imports.

President Bush said in a speech Wednesday, "It makes sense to promote ethanol as an alternative to foreign sources of oil." He reiterated his call for Congress to send him an energy bill by Aug. 1.

Dianne Feinstein, D-Calif., said the ethanol mandate would mean refiners in her state would be forced to use ethanol or purchase costly credits under a credit-trading system. "Either choice will mean California consumers pay more at the pump," she said.

Feinstein also disputed claims that ethanol would reduce oil imports. Because ethanol has a lower energy content than gasoline, more blended gasoline will be needed to travel the same distances, resulting in an estimated 3 percent reduction in fuel economy, she said.

Ethanol receives a 51 cent-a-gallon tax credit, so a doubling of ethanol use also would result in lost revenue for the government, added Feinstein.

The ethanol industry is expected to produce about 4 billion gallons of corn-based ethanol this year, or about 3 percent of gasoline by volume.

The price impact of ethanol at the pump is unclear. The Environmental Protection Agency estimates the added cost could be as much as 4 to 8 cents a gallon, a figure disputed by the ethanol industry.

The price of ethanol has declined over the past six months, causing downward pressure on gasoline prices, Sen. Ben Nelson, D-Neb., argued in support of the ethanol mandate. The Renewable Fuels Association, which represents ethanol producers, says ethanol-blended gas has been cheaper than or comparable to other gasoline in California and New York. In those states, more ethanol has been use since another additive, MTBE, was banned beginning in 2004.


TOPICS: Business/Economy; Foreign Affairs; Government; News/Current Events
KEYWORDS: 109th; brazil; cafta; energy; energybill; ethanol; sugar
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Growing demand for cheaper, cleaner gas gets boost from Ontario ethanol fund

Monteiro Aranha Plans $100 Mln Brazil Ethanol Project

Ethanol plant in Fulton

Ethanol plant approvals stopped

The U.S. agribusiness giant Cargill Inc., the third-largest U.S. ethanol refiner, announced plans last year to refine Brazilian ethanol in El Salvador and export it to the United States duty-free under provisions of the Caribbean Basin Initiative.
1 posted on 06/17/2005 11:52:01 PM PDT by hedgetrimmer
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To: JesseJane; Justanobody; monkeywrench; B4Ranch; Nowhere Man; swampfox98
New ethanol technology could save gas

OIL SETS NEW RECORD: $58.60 os the headline. The subtext is that sugar cane is about to become very valuable because the federal government mandating its use just at the same time they are voting for trade policies via CAFTA that will shift sugar production outside of the US forever.
2 posted on 06/17/2005 11:57:45 PM PDT by hedgetrimmer
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To: hedgetrimmer
Feinstein and Schumer also noted that limousines require higher octane and both they and their donors would be inconvenienced.
3 posted on 06/17/2005 11:57:51 PM PDT by ncountylee
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To: hedgetrimmer

Before the ignorant descend with their blatherings on the "expense" of ethanol:

http://www.ncga.com/public_policy/PDF/03_28_05ArgonneNatlLabEthanolStudy.pdf

And , to you I will say, thanks for posting the evidence that the greedy agri-giants are taking our farmers' chance at making money (for a change) and giving it away to South America.


4 posted on 06/18/2005 12:02:42 AM PDT by garandgal
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To: ncountylee

Could Cargill be a donor? Shouldn't the United States be producing ethanol for export?

Cargill Looking To Buy Brazil Sugar Producer -Report

SAO PAULO (Dow Jones)--U.S. agribusines giant Cargill (CRG.XX) is in negotiations to buy Brazilian center-south sugar and ethanol producer Acucareira Corona for an estimated $150 million, the local business daily Valor Economico said Thursday.

Cargill is a major shipper of Brazil's world-leading sugar exports, but this deal would be its first foray into sugar and ethanol production from sugarcane here.

Acucareira Corona is one of the oldest milling groups in the top-producing north-west Sao Paulo region. It possesses two mills, the Corona plant in Guariba and Acucareira Nova Tamoio in Araraquara.

In the 2004-05 season (May-April), the two mills processed 5.8 million tons of cane to produce 520,000 tons of sugar and 165 million liters of ethanol.


The two groups have been negotiating for the last four months, according to the report.

Brazil's center-south industry is going through a period of expansion as it sees demand for its sugar, and more particularly, its ethanol fuel production grow.

After years of stagnation, demand for ethanol is growing in Brazil with the introduction of flex-fuel cars, which run on any mixture of gasoline and ethanol. Meanwhile, exports are also growing as other countries seek to use cheap Brazilian ethanol for industrial ends and is expected to grow further as ethanol is introduced as an additive into fuel abroad.

Brazil's center-south region produces approximately 85% of the country's cane output. Some 50% of thus output is turned into ethanol. Production is pegged at 345 million tons for the 2005-06 season, according to the Union of Sao Paulo Sugarcane Industries, or Unica. That's 4.9% higher than last year.


5 posted on 06/18/2005 12:02:46 AM PDT by hedgetrimmer
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To: garandgal

I don't know if you saw the thread but there are those on this forum who've complained that the sugar beet farmers should stop growing their crops.

Here is an interesting rebuttal for them:

Norfolk to pioneer green fuel

Britain's first refinery to produce “green” fuel from sugar beet will come on stream in Norfolk in less than two years, said British Sugar.

The £10m plant will be built at Wissington, near Downham Market, on the site of Europe's largest beet sugar factory and will produce 5pc of the nation's green fuel.

It is a major boost for Britain's fledgling biofuels industry, which could create thousands of jobs and help the rural economy.

The plant will process 750,000 tonnes of sugar beet to produce 55,000 tonnes of bioethanol.


6 posted on 06/18/2005 12:06:06 AM PDT by hedgetrimmer
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To: hedgetrimmer
Absolutely! This could be a huge market.
7 posted on 06/18/2005 12:06:41 AM PDT by ncountylee
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To: hedgetrimmer
Could Cargill be a donor? Shouldn't the United States be producing ethanol for export?

Of course we SHOULD! After we developed it, and individual farmers poured tens of thousand of dollars into it to build their own co-op plants when it was an exceedingly risky proposition; now the giants have seen the light and will do what they usually do. Rape and pillage their own countrymen for profit; why would you be surprised?

I'm only surprised that they are allowed to do so...tells you everything you need to know about our "representatives."

8 posted on 06/18/2005 12:09:26 AM PDT by garandgal
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To: hedgetrimmer

I prefer to see my corn squeezins in a bottle rather than in my gas tank.

9 posted on 06/18/2005 12:11:24 AM PDT by FreedomCalls (It's the "Statue of Liberty," not the "Statue of Security.")
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To: hedgetrimmer

ADM's role?


10 posted on 06/18/2005 12:12:07 AM PDT by endthematrix (Thank you US armed forces, for everything you give and have given!)
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To: hedgetrimmer
Here is an interesting rebuttal for them

You and I know perfectly well that any rebuttal will be summarily ignored. We are suckers. We develop, fund, and take all of the risk of developing new products...only to be sold out as soon as it's apparent we have a good product.

11 posted on 06/18/2005 12:14:21 AM PDT by garandgal
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To: endthematrix

ADM gets a $0.51 a gallon subsidy for their ethanol produced from corn. Corn is a more expensive less efficient way to produce ethanol than sugar cane. Someone else digging around may find something interesting.


12 posted on 06/18/2005 12:18:14 AM PDT by hedgetrimmer
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To: hedgetrimmer

The heck with ethanol. I say put methanol in our tanks and no speed limits.


13 posted on 06/18/2005 12:27:29 AM PDT by carumba
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To: carumba

woo hoo!


14 posted on 06/18/2005 12:30:10 AM PDT by hedgetrimmer
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To: hedgetrimmer
ADM gets a $0.51 a gallon subsidy for their ethanol produced from corn. Corn is a more expensive less efficient way to produce ethanol than sugar cane. Someone else digging around may find something interesting.

Actually, I should have mentioned this in the first place. If you go to my link, you will find that ethanol production from corn used to be considered "expensive" but newer studies (considering new technology...and volume) show greatly reduced costs.

I am telling you, farmers (and local co-ops) drove this entire thing...with their own money. The usual suspects are now getting involved (off-shore of course) AFTER the risks were already taken. Those who took the original risks will get screwed in the process.

I need only to point out that public offerings for new ethanol plants are now being bought out almost immediately by "fund managers," with initial investments of $20,000 or more. The minute these "manangers" find a cheaper producer offshore they will be all over it in the name of "profits for the shareholders."

Why we let this transfer of technology and riches to go on is completely beyond me.

15 posted on 06/18/2005 12:31:37 AM PDT by garandgal
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To: garandgal
Why we let this transfer of technology and riches to go on is completely beyond me.

We don't. But our elected representatives look as though representing the citizens of the USA is somewhat beneath their dignity. Its much more fun for the presidents of the CAFTA nations to come and lobby them for US largess than it is for them to deal with just plain folks.
16 posted on 06/18/2005 12:36:22 AM PDT by hedgetrimmer
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To: hedgetrimmer
We don't. But our elected representatives look as though representing the citizens of the USA is somewhat beneath their dignity.

Oh, I KNOW that. But what are we supposed to do? The idiots killed the "country of origin" labeling deal a couple of weeks ago, by providing no funding after it was passed. They (with some noteable exceptions) are bought and paid for with more money than farmers could ever hope to gather.

17 posted on 06/18/2005 12:53:30 AM PDT by garandgal
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To: hedgetrimmer

Some senators have been fed a bill of goods. This won't help at all.


18 posted on 06/18/2005 12:55:59 AM PDT by nightdriver
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To: garandgal

I have read most of the studies on Ethanol including Wang's. Why is Tad Patzek's brillian analysis missing from the Argonne chart of Corn Ethanol Fossil Energy Balance?

Could it be because Professor Patzek's results show *conclusively* that it takes more fossil energy to create a unit of ethanol than is contained in that resulting unit?

Instead of suggesting that those who correctly think that ethanol is a sop to corn farmers are ignorant, you might spend some time doing a little reading.

Ethanol is yet another BIG GOVERNMENT program that the GOP endorses. To think we used to be the party of small government too...

You can read Professor Patzek's "Thermodynamics of the Corn-Ethanol Biofuel Cycle" here: http://petroleum.berkeley.edu/papers/patzek/thermodynmaics%20of%20cornethanol.htm


T. W. Patzek
Thermodynamics of the Corn-Ethanol Biofuel Cycle
Critical Reviews in Plant Sciences,
23(6), 519-567, 2004

Abstract
In this paper I define sustainability, sustainable cyclic processes, and quantify the degree of non-renewability of a major biofuel: ethanol produced from industrially-grown corn.

First, I demonstrate that more fossil energy is used to produce ethanol from corn than the ethanol's calorific value. Analysis of the carbon cycle shows that all leftovers from ethanol production must be returned back to the fields to limit the irreversible mining of soil humus. Thus, production of ethanol from whole plants is unsustainable. In 2004, ethanol production from corn will generate ~11 million tonnes of incremental CO2, over and above the amount of CO2 generated by burning gasoline with 115% of the calorific value of this ethanol.

Second, I calculate the cumulative exergy (available free energy) consumed in corn farming and ethanol production, and estimate the minimum amount of work necessary to restore the key non-renewable resources consumed by the industrial corn-ethanol cycle. This amount of work is compared with the maximum useful work obtained from the industrial corn-ethanol cycle. It appears that if the corn ethanol exergy is used to power a car engine, the minimum restoration work is about 7 times the maximum useful work from the cycle. This ratio drops down to 2.4, if an ideal fuel cell is used to process the ethanol.

Third, I estimate the U.S. taxpayer subsidies of the industrial corn-ethanol cycle at $3.5 billion in 2004. The parallel subsidies by the environment are estimated at $2.0 billion in 2004. The latter estimate will increase manifold when the restoration costs of aquifers, streams and rivers, and the Gulf of Mexico are also included.

Finally, I estimate that (per year and unit area) the inefficient solar cells produce ~100 times more electricity than corn ethanol. We need to rely more on sunlight, the only source of renewable energy on the earth.


19 posted on 06/18/2005 1:12:41 AM PDT by jas3
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To: jas3
Re: "Ethanol is yet another BIG GOVERNMENT "

It's big business...the subsidized kind. If you thought the Congress/defense industry was a revolving door king, Agra business isn't far behind.
20 posted on 06/18/2005 1:23:19 AM PDT by endthematrix (Thank you US armed forces, for everything you give and have given!)
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