Ethanol Fuel is not so Green

The Oil Drum Forum ^ | February 6, 2008 | Phil Hart

[JerseyHighlander]

Ethanol Fuel is not so Green

The Australian Department of Parliamentary Services has released a research paper on "The economic effects of an ethanol mandate". Published on 22 January 2008, it is available from the Parliamentary Library website.

Paul Syvret, in the Brisbane Courier Mail article Ethanol fuel is not so green, expressed his view on ethanol and summed up the paper by saying:

ETHANOL is not the answer for Australia's future fuel needs.

It is not green, it is not economically viable, and any move to mandate its inclusion in fuel would have enormous repercussions for other sectors of Australian industry.

Here are a few of the highlights from the report:

• Reduced oil imports are only one effect of an ethanol mandate on the trade account. Any diversion of feedstock from exports or increased imports of feedstock needed to meet the mandate would increase the trade deficit.
• A mandate is only one way of reducing reliance on imported oil. Importing ethanol, for example, would be less economically costly than a mandate, and would diversify geographic supply sources and the composition of fuel.
• The evidence suggests that the costs of creating jobs under an E10 mandate would be high. A mandate could also adversely affect other rural industries.
• The Biofuels Taskforce that the Howard Government established concluded that greenhouse gas benefits alone would not warrant further assisting biofuels given the availability of much cheaper carbon reduction options.
• The additional demand for feedstock under a mandate might lead to competition for land from other uses such as food and exports. Views differ on the potential for competition for land use in Australia.
• A mandate could benefit the economy if domestic ethanol could compete with imports without government assistance.
• Even though a comprehensive cost-benefit analysis of an ethanol mandate has not been undertaken, no prima facie economic case for a mandate has been established.

The research paper was fairly blunt about the competitiveness of ethanol:

How would a mandate work

A mandate increases demand for ethanol above what market forces (supply and demand) would otherwise determine. It generally costs more to produce ethanol than petrol (allowing for the fact that ethanol contains less energy than the same volume of petrol).

In the absence of a subsidy to encourage the use of ethanol, and with a tax regime that is neutral between petrol and ethanol, motorists would prefer to buy petrol rather than fuel ethanol because petrol is cheaper.

A mandate is thus a form of ‘compulsory demand’ because it obliges motorists to buy ethanol even when ethanol is uncompetitive with petrol. Because it generally costs more to produce ethanol than petrol, a mandate would increase the price of fuel in the absence of an ethanol subsidy. The price increase is a redistribution of income from motorists to ethanol producers.

A mandate is, in effect, a subsidy to ethanol producers paid by fuel users.

Read the rest and some excellent commentary here (Pops to new window): http://www.theoildrum.com/node/3578

[JerseyHighlander]

Looks like a very thorough discrediting of the Ethanol lobbyists talking points and underlying claims from the Australian Government. It's a good thing too, wheat and cattle feed is in no need of a further pricing shocks in Australia.

[TenthAmendmentChampion]

GW ping

[saganite]

LOL. The Emperor has no clothes.

[who_would_fardels_bear]

Another thing that environmentalists and welfare farmers and bureaucrats neglect to tell us:

After you process all of the green stuff that goes into making ethanol, when it comes out the other end it is no longer green!

Imagine how much dye we would need to buy to keep this process green?

Not to mention that we might price a lot of smaller cities out of being able to dye their local rivers, lakes, and kegs green for St. Patrick's Day.

This is truly an abomination!

[JerseyHighlander]

Thought this might be of interest to you. If you have a AU ping list maybe post this to it.

[chaos_5]

Allow me to dismiss this in the same way the pinko echo-Nazis will.

There guys are just paid off by big oil!

[xcamel]

FReepmail me to get on or off

Click on POGW graphic for full GW rundown

New!!: Dr. John Ray's
GREENIE WATCH

Ping me if you find one I've missed.

---

'Bout time.. I think about it with every food purchase too... ready for $5/gal Milk??

[alloysteel]

Ethanol is a dead end.

Except for perhaps getting the opponents to REAL energy self-sufficiency into such a falling-down drunken stupor, that they mistakenly vote to lift the restrictions on energy extraction within our own borders. Like open up the coal reserves in the Escalante country in Utah, tap into the PROVEN and the potential reserves in the Alaskan North Slope and off our own coastal waters, including ANWR, begin extracting fissionable material to fuel the new technology that will be used in the nuclear power plants in this country, applying known and proven technology to dispose of the waste stream in this country (the Plasma trash reduction process), even going back and opening up old landfills to extract the methane that has been accumulating there.

And new sources of energy, most notably Methane Hydrate, would be collected from the base of the continential shelf that surrounds every land mass in the world. In fact, it may be to our advantage to harvest this accumulation of Methane Hydrate, to prevent its eructation under the influence of warming ocean currents reaching the depths where it is known to exist. This removal of a potential hazard, and harnessing it for use in the generation and distribution of energy may be the new frontier in the coming future of general prosperity.

Again, ethanol is not the way to go. It may bring some short-term prosperity to crop production, but at what cost? Reclamation of waste from farming operations, in the form of Thermal Depolymerizaton, may proved to be a better use of resources than continously mining the soil, to produce crops suitable for the production of ethanol.

[Mr. Lucky]

continuously mining the soil

Oh, please. Privately owned farmland in the US is far more fertile and productive today than it has ever been. There is a continuous trend of better yields with fewer energy and chemical inputs and that trend has been accelerating with the advance of plant genetics.

[WOBBLY BOB]

http://www.twincities.com/ci_8197147

Study: Converting land into biofuel crops worsens global warming

[steelyourfaith]

Thanks again TAC!

Beam me to Planet Gore !