Renewable Fuels Standard Could Gobble Up America’s Entire Corn Crop

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The government must stop mandating ethanol production, Mark Perry notes. It drives up prices and, unless something is done, in the not-so-distant future the mandate may have our entire American corn crop diverted to making ethanol:

Corn ethanol is clearly inferior to gasoline as a fuel source for automobiles. Despite a 51-cent-per-gallon tax credit to companies that blend ethanol into gasoline, ethanol costs about 70 cents a gallon more than gasoline on an energy-equivalent basis. Instead of helping consumers, ethanol provides 27% lower fuel economy than gasoline.

Realistically, you have to burn a lot more ethanol-based fuel to create the same amount of energy to power your car, which has unnecessarily driven up the cost of operating a vehicle. And there are serious long-term adverse environmental implications from using corn ethanol. Growing corn to make fuel requires significant amounts of fertilizer and pesticides that pollute the soil, underground aquifers and waterways. The National Research Council has determined that corn ethanol uses significantly more water in its production cycle than gasoline.

So far, neither the Administration nor Congress has confronted the fact that 40% of the U.S. corn crop is used to produce ethanol, which has increased retail food prices and strained family budgets in their never-ending struggle to put food on the table.

The first step to adopting a more sensible ethanol policy is to halt the production of E15, since it is caustic and can ruin car engines, while doing nothing to moderate gasoline prices or improve the environment. The Renewable Fuel Standard requires escalating the production of ethanol, ramping up from 13 billion gallons this year to 36 billion gallons by 2022. Unless cellulosic ethanol becomes available, that level of production would require switching the nation’s entire corn crop to the production of corn ethanol.

That would be a recipe for disaster. Congress needs to roll back its mandate. It’s time to stop throwing our tax dollars at ethanol.

The problem, of course, is that ethanol is great for the agriculture industry. The artificial demand for ethanol crops the government is creating means higher crop prices for farmers.

Which is what’s tough about the food markets. Higher food prices aren’t great for the rest of us, but they’re good for farmers.

Rob Port is the editor of SayAnythingBlog.com. In 2011 he was a finalist for the Watch Dog of the Year from the Sam Adams Alliance and winner of the Americans For Prosperity Award for Online Excellence. In 2013 the Washington Post named SAB one of the nation's top state-based political blogs, and named Rob one of the state's best political reporters. He writes a weekly column for several North Dakota newspapers, and also serves as a policy fellow for the North Dakota Policy Council.

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  • igx

    Algae bio diesel is the only one that makes any sense.

  • splined

    If all USA crop acres were grown to corn for ethanol the ethanol extremists would still be claiming that food prices are unaffected. I guess the recent doubling or tripling of food prices is still not providing enough income for the greediest producers among us. Yet these same people make the same absurd claim that diverting 40% of the corn acreage to ethanol production is not affecting food prices.

  • Onslaught1066

    Actually this would help out Susan a great deal, as corn is very fattening which is why they feed it to heifers as well as cattle.

  • borborygmi

    celluslosic switch grass or plant time to plant more corn

  • ptschett

    The quoted section isn’t entirely factual. The 51 cent ethanol tax credit ended more than a year ago. And ethanol’s impact on corn use is closer to 15% of the crop when byproducts (corn oil, distiller’s grains) are considered.

  • tl

    “Corn ethanol is clearly inferior to gasoline as a fuel source for automobiles.” Well, that all depends on your objectives. High octane E85 might help a turbo 2.5L Subaru make ~10% more HP and torque and nearly eliminate the possibility of knock-related engine failure. The politics are a separate issue, but the fuel has it’s place.

    • Paul Overby

      In fact, the oil industry has taken advantage of that benefit and when there was blip in the corn market this past week, the price of ethanol went up as suppliers were locking in supply, not price, in case plants had to close from corn prices being too high. A bit of irony there!

  • Waski_the_Squirrel

    Just curious (because I don’t know). Is there a reason our country seems to think corn-based ethanol is the only ethanol? Isn’t there cellulosic ethanol? And didn’t I hear about ethanol made form sugar cane?

    • Paul Overby

      We are importing quite a bit of cane ethanol from Brazil right now, particularly to the West Coast. In the Gulf it would be more expensive than US ethanol, but the cost of transporting large quantities of ethanol by rail or truck to California makes ship transportation more cost effective.

  • splined

    By ANDREW P. MORRISS

    For more than two decades, special interests have persuaded Congress to mandate Americans buy ethanol whether they want to or not. As a result, 40 percent of the U.S. corn crop is now used for ethanol rather than food.

    The ethanol mandate means that ordinary Americans pay more for a poorer quality automobile fuel and more for groceries. Ethanol proponents claim these costs will bring us environmental benefits and energy security. They are wrong.

    A good first question about a mandate is “how good can a product be if you have to force people to buy it?”

    The answer: not very good. Ethanol is vastly inferior to gasoline.

    Consider these glaring drawbacks: Its energy density is a third lower, reducing cars’ emissions. It attracts water, so it cannot be transported in regular gas and oil pipelines, reduces lubricants’ effectiveness, and shortens engine lives. It is caustic, corroding engine parts and dislodging contaminants from fuel tanks.

    While ethanol doesn’t make gasoline cleaner, the more intensive farming and water needs of ethanol refining harm the environment.

    Moreover, mandates for ethanol don’t enhance national security because production of corn-based ethanol – the main type of ethanol in use in America – requires roughly as much energy as the ethanol contains.

    Running tractors, combines and trucks, making fertilizer, and refining corn into ethanol all require energy – mostly from oil and natural gas. If the weather is good, corn ethanol shows a slight energy gain over the fuel used to make it; if not, it might be a net loss. The ethanol mandate just burns money to turn oil and natural gas into corn.

    The mandate for corn-based ethanol also drives up food prices. Meeting the 2015 mandate will require using 5.3 billion bushels of corn. As a result of the forced conversion of corn to ethanol, any food containing corn – including pork, beef and ice cream – costs more.

    The National Council of Chain Restaurants estimates the ethanol mandate costs each of its members $18,000 per year. An inconvenience for wealthy people, rising corn prices are disastrous for the poor, at home and abroad. A Tufts University study estimated that Mexicans paid $1.5 billion more for food from 2006 to 2011.

    During 2012’s drought, U.S. hog farmers imported corn from Brazil while U.S. corn was being made into ethanol. This is even more ridiculous than it sounds as Brazil is an efficient producer of sugar-cane based ethanol. Because of trade barriers designed to protect the U.S. ethanol industry, farmers were forced to import Brazilian corn instead of Brazilian ethanol.

    Why do we have an ethanol mandate? Politics, clear and simple.

    According to the Center for Responsive Politics, ADM has contributed $10.46 million to politicians and spent $8.94 million on lobbying since 1990.

    Moreover, holding the first presidential nominating contest in Iowa, a corn and ethanol producing state, means politicians seeking to be president must curry favor with ethanol producers.

    Before his 2008 run for president, Sen. John McCain, R-Ariz., opposed ethanol subsidies and said “No one would be willing to buy it” without federal mandates. In 2008 in a speech in Grinnell, Iowa, he declared it “a vital alternative energy source.” That flip-flop from Congress’ most famous “maverick” illustrates the power of ethanol special interests.

    It is long past time to get the ethanol lobby’s hand out of our wallets. If 20 years isn’t enough time for ADM, other ethanol producers and corn farmers to stand on their own feet without holding a gun to our heads to force us to buy an inferior product, how much time will be enough? It is time to end the ethanol scam.

    ABOUT THE WRITER

    Andrew Morriss holds the D. Paul Jones Jr. and Charlene A. Jones chair in law and professor of business at the University of Alabama. Readers may write to him at UA Law, 101 Paul W. Bryant Drive East, Tuscaloosa, Ala. 35487; email: [email protected].

  • Lynn Bergman

    U.S. ethanol producers are expected to use 78.9 metric tons of corn this year, the lowest percent (2.92%) of global grain stocks in five years. And the amount of grain available for non-ethanol purposes will be the second-highest on record, bested only by 2011’s amount. EthanolRFA.org/The E-Xchange blog

    Bottom line; grains for ethanol represent a decreasing percent of total grain produced.

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