Emerald Renewable Energy, a Cargill subsidiary, announced today that it's suspending the construction of an ethanol plant just outside Topeka, Kansas. In an interview with the Topeka Capital-Journal, company spokesman Bill Brady said, "The economics are not at a point where we see fit to move forward... the economics are not where they were a year and a half ago."
Vague, much?
Brady wouldn't discuss the factors contributing to the decision. But Jay O'Neil, a senior agricultural economist at Kansas State University, said escalating grain prices are making it difficult for ethanol plants to make a profit.
Corn, used to make ethanol, is at a record price, more than $5 a bushel, and the cost to build an ethanol plant has doubled the past five years. If high corn prices continue, O'Neil said, companies could face losses.
USA Today: Cargill suspends plans for Kansas ethanol plant
So corn ethanol, the "silver bullet" fuel that was going to free us from addiction to foreign oil and allow America to lead the world in energy security - at least according to Bush's 2007 SOTU Address - is simply another failure in a long line of miscalculations by this Administration. But hey, no one could have anticipated this.
Well, except this guy:
But skeptics point out that Bush’s goal for ethanol would require big advances in "cellulosic ethanol," which has yet to be produced at anything close to competitive prices, and massive changes to U.S. farmland.
"Producing 35 billion gallons of ethanol a year would require putting an additional 129,000 square miles of farmland - an area the size of Kansas and Iowa - into corn production, which is not very likely," said Philip Clapp, president, National Environmental Trust. "The President’s proposals will contribute almost nothing to stopping global warming. They will allow our carbon emissions to grow by 14 percent over the next 10 years. He has proposed a paltry one-and-a-half percent cut in the galloping growth of our emissions by 2017.
Environmental Leader: Bush’s State of the Union Energy Plan Gets Mixed Reaction
Oops! This guy too:
From General Motors, an ad campaign called "Live Green, Go Yellow" gave America the impression that by purchasing GM vehicles capable of using E85 ethanol, we could help reduce our dependence on foreign oil.
What GM left out of its ads was that the use of this fuel would likely increase the amount of smog during the summer months (as the EPA's own attorneys had admitted in 1995) -- and that using E85 in GM products would lower their fuel efficiency by as much as 25%. (USA Today recently reported that the Energy Dept. estimated the drop in mileage at 40%.)
But one final setup for the public has gone unnoticed. At the Web site www.fueleconomy.gov, which confirms the 25% to 30% drop in mileage resulting from the use of this blended fuel, another feature lets users calculate and compare annual fuel costs using regular gasoline to costs using E85.
But the government site's automatic calculations are based on E85 selling for 37 cents per gallon less than regular gasoline, when the USA Today article reports that at many stations in the Midwest E85 is actually selling for 13 cents per gallon more than ordinary gas. Using the corrected prices for both gasoline and E85, the annual cost of fueling GM's Suburban goes from $2,709 to $3,763. Hence the suggestion that truth in advertising should come back into play. Possibly GM could rename this ad campaign "Shell Out Green, Turn Yellow."
Business Week: Ethanol: A Tragedy in 3 Acts
Holy corncob pipes, Batman! Here's another one!
Cornell Professor of Ecology David Pimentel makes the claim in the latest issue of the journal Natural Resources Research (Vol. 12, No. 2). The dubious economics of corn-based ethanol, Pimentel writes, are threefold:
- In general, gasohol is priced higher at the pump than gasoline, yet yields poorer mileage per gallon.
- Taxpayers are the source of $1.4 billion a year in subsidies that help make ethanol production profitable for agribusiness firms.
- In addition to paying tax dollars for ethanol subsidies, says Pimentel, consumers can be expected to pay significantly higher food prices in the market place. Why? He cites the National Center for Policy Analysis' 2002 estimate that ethanol production is adding more than $1 billion to the cost of beef production. This, he says, is because producing the required corn feedstock for ethanol reduces the overall corn supply, adding about 2 cents a bushel to the price farmers receive for their corn, by his calculation. "Because about 70 percent of the corn grain is fed to U.S. livestock, doubling or tripling ethanol production can be expected to increase corn prices further for beef and livestock production and ultimately increase costs for the consumer," Pimentel states.
Cornell University News: CU agricultural ecologist continues criticism of corn-based ethanol
So, to sum up:
- Corn ethanol not as efficient as gasoline
- Corn ethanol produces more smog
- Corn ethanol has led to increase in corn prices, leading to increases in food costs
- The nation isn't equipped to produce corn ethanol in quantities large enough to make a difference
- Cars using corn ethanol get worse fuel efficiency than gas-powered ones
- General Motors lied to us! Big meanies!
- Corn ethanol costs more per gallon than gas
- Taxpayers get slammed again by paying for corn subsidies so that agribusiness won't be denied profits
- Etc.
I could go on, but honestly, why? Dr. Pimentel was saying as far back as 2003 that corn ethanol was a supremely bad idea. But he's a DFH librul academic elitist, so it's not like his opinion matters to BushCo.
What did they think would happen by tying fuel production to a food product? (A rhetorical question; we all know that nobody in this Admin has a clue.)