08 April 2008

Biofuels vs. Food: The False Debate

Recent exciting breakthroughs in the direct conversion of grass and wood biomass to liquid biofuels demonstrates the absurdity of much of the "food vs biofuels" debate. As one can easily discover by even a cursory search, biofuels/biomass R&D has progressed light years beyond maize ethanol.

Biomass combined heat and power (CHP), high yield biodiesel from algae and other non-food oil crops, thermochemical production of liquid and gaseous biofuels from waste biomass, and a host of new second and third generation bio-energy projects are moving to production. Newer approaches to non-food bio-energy hold even greater promise for bringing local and regional jobs, productivity, and prosperity.
According to Bruce Date, the ethanol expert of Michigan State University, “we could feed the country’s (America’s) population with 25 million acres of farmland, and currently have 500 million acres. Most of our agricultural land is being used to grow animal feed.” About 76% of the corn consumed in the US is used as animal feed. America exports 20% of its corn. Two-thirds of these corn exports go to 28 OECD countries, where they feed animals.

For every tonne of corn that America exports to one of the 25 countries with the most serious malnutrition problems in the world, it exports 260 tonnes to a wealthy member country of the Organisation for Economic Cooperation and Development (OECD).

Even in the United States, most energy crops are grown on marginal land where no commercial crops are being raised now. Prime acreage is not diverted to the production of bio-fuels.

A lot of research still needs to be done to identify the best raw materials to produce ethanol or other bio-fuels. Corn is far from being the ideal raw material...It is, therefore, important to explore new and more environment-friendly sources such as agricultural waste to manufacture [biofuels]. Some research studies report that pine groves can be an excellent source of [biofuels]. Perennial prairie grasses are considered to be among the best raw materials to manufacture [biofuels] from.

...Above all, the paramount need is to improve agricultural productivity across geographies. Crop yields can be increased through the introduction of technologies such as drip irrigation or through education and training of farmers. If countries like India and China, which have large swathes of agricultural land, can boost their productivity to the levels attained by the developed world, it will significantly mitigate food scarcity while creating enough agricultural elbow room for the cultivation of crops to manufacture green bio-fuels like ethanol or bio-diesel. ___ET
It is time for the debate to catch up to the reality in the labs and in the new bio-energy plants. For reasons of their own, too many analysts are stuck on ten or twenty year old concepts, and unwittingly take sides in an obsolete debate.

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Blogger Stephen Gordon said...

Al Fin:

I agree, but it would be nice if our government stopped subsidizing corn ethanol. Just let ethanol (from all sources) compete with gasoline in the free market.

Or, if the government just can't help but subsidize something, let it be ethanol or biofuels that are being produced on land not suitable for food crops.

Stephen from "The Speculist"

Tuesday, 08 April, 2008  
Blogger Stephen Gordon said...

Not that I'm against all government action. I think a flex-fuel mandate would be a great step.

Tuesday, 08 April, 2008  
Blogger al fin said...

I agree, Stephen.

Ben Nelson and Chuck Grassley, US Senators from corn states, have declared that government mandates for corn/maize ethanol will only be stopped over their dead bodies.

To which I say, "fine." Thermochemical conversion to biofuels like diesel and gasoline can use dead bodies as a feedstock without a problem.

Tuesday, 08 April, 2008  
Blogger Hell_Is_Like_Newark said...

I have read that their is hesitance in investing in alt. fuels because of fear that oil prices will collapse again, causing expensive investments to become worthless.

One proposed solution would be the Feds to set a minimum price on oil. For example, set the minimum price at $60 per barrel for light sweet crude. If prices drop below that, a tax would be added to bring the price back to $60. Taxes collected on oil would offset payroll taxes.

With a minimum price enforced, then there would be less fear of a sudden price collapse (as what happened in the late 90's).

Tuesday, 08 April, 2008  
Blogger IConrad said...

"One proposed solution would be the Feds to set a minimum price on oil. For example, set the minimum price at $60 per barrel for light sweet crude. If prices drop below that, a tax would be added to bring the price back to $60. Taxes collected on oil would offset payroll taxes."

This one'll pass over //MY// dead body. It's sheer insanity to think that price-fixing energy costs arbitrarily high in one nation will do //ANYTHING// good for that nation.

Tuesday, 08 April, 2008  
Blogger Will Brown said...

Like the fuel/food debate, what we essentially have here are two separate arguments concerning a particular subject being conflated to (further) confuse the issues involved.

The problem of wildly fluctuating oil prices effect on industry investment might be ameliorated by something like the tax idea suggested above (Maugeri mentions it in his The Age of Oil as a recurring industry suggestion I seem to recall).

The effect such legislation would undoutedly have on the commodities trading markets is less clear for all it's certainty, but the likelihood would seem to trend towards a negative impact on individual consumers at the very least as Ironclad observes.

Two different and contradictory drivers of energy costs that seem to defeat efforts to resolve either separately. I confess my ignorance of the issues involved prevents any specific suggestion, but de-linking (or possibly combining) these two influences on energy industry practices will likely be part of any eventual solution that doesn't also involve de-volution of energy markets - which result has to be regarded as the default setting for all human socio-economic constructs.

Sad to say, I think our best hope for a successful resolution lies with the existing market structure being overtaken (and thus forced to adapt) by technological innovation to energy supply/distribution technology. Such an event (or more likely series of events) will cause it's own class of societal disruptions and costs, but should expand the selection of source available to energy consumers. The more diverse a market, the less influence any particular cost driver has, so price competition ought to be one result.

Or so one may devoutly hope. Not much consolation at any of our next fill-up at the gas station I'm afraid, but you mine for silver linings where you can.

Wednesday, 09 April, 2008  

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