ethanol, duh

like you put in the subject, well duh. That's what happens when people let the government dictate technology.

It not only benefited the farmers, it is a huge benefit to the petrol industry, they own or have a large interest in ethanol refining, which also uses more petrol refine it than it replaces. BUSH STRIKES AGAIN kg

Except the evidence looks like the markets have dictated technology to Congress not the other way around.

Current ethanol usage exceeds govt mandates and that has been the case for about a dozen years. Congress has changed the mandated level a couple times in that period. If Congress had not changed the mandates to keep up with growing corn ethanol usage the usage now would be more than twice the level mandated.

Meanwhile, Congress has for years mandated the use of ethanol from switch grass and practically nobody is producing and selling any cellulosic ethanol .

You will claim that it is tax breaks and subsidies that are behind ethanol's market presence, but all the tax breaks and subsidies for corn ethanol ended a year ago and corn ethanol usage continued to gain market share.

Not sure what you are trying to claim, but I don't see any noticeable increase in farm fuel usage since 2000. Since 2000 ethanol production has increased by more than 1000%.

For almost 100 years the oil refiners have needed a octane booster to meet the octane standards. Oil refiners can produce the necessary octane but it takes more energy and costs more to produce regular fuel without an octane additive.

Don't think of ethanol as a fuel, think of ethanol as an octane improving additive.

Replacing petroleum with ethanol is a bad idea, but replacing MBTE and tetraethyl lead with ethanol is a very good idea in the end.

To my mind, ethanol is a mixed bag and it's not all bad, but it's not all good either.

--scott

Corn industry lobbists aren't the market.

Ethanol would not be produced from corn if it weren't for government subsidy and/or mandate. Ethanol is used as an oxygenate and renewable content which are other government mandates. Oil companies used MTBE, a by-product of their own operations until it started contaminating ground water. It's a multi-piece puzzle of political means that the corn lobby has had installed.

Because nobody has figured out how to make it.

Gain market share over what? What is the other oxygenate on the market? Required by federal law. What other renewable fuel is there to mix with gasoline? Required by federal law. Furthermore ethanol use is mandated while the sugar and lobbies have largely prevented the importation of sugarcane based ethanol from overseass as well.

If you don't believe me the basics seem to be in this article:

"The RFS mandates that at least 37 percent of the 2011-12 corn crop be converted to ethanol and blended with the gasoline that powers our cars" ... "As the Congressional Budget Office wrote back in 2010, "In the future, the scheduled increase in mandated volumes would require biofuels to be produced in amounts that are probably beyond what the market would produce even if the effects of the tax credits were included." "

37% of the crop... not a percentage in the gasoline. A percentage of the crop. The reason ethanol use is increasing is because it is required by law to.

MTBE is worse than ethanol in every respect, but it is made from petroleum so the oil companies managed to keep it on the market for a couple decades.

Nonsense, It is made. It is just not as economical.

Most of the country is not required to have any oxygenate.

Nope. That tariff was done away with a year ago and didn't make a bit of difference. And there aren't any mandates that force shipping tankers full of ethanol to the mideast where they blend it as an octane booster.

>

Your article is full of misinformation. Show me the law that says 37% of the crop must go to ethanol.

If the mandate is so meaningful how come no one pays attention to the switchgrass mandate? And how come the corn ethanol market exceeds what the mandate requires? It has already met the mandated goal for 2015. In fact for the last 7 year the market has been about 3 years ahead of govt targets. And Congress changed the mandate upwards twice because ethanol sales was so far ahead of previous targets.

While true, it is the other oxygenate that can be used, so here's your current choice for many areas of the country: ethanol or MTBE and MTBE isn't allowed any longer.

I neglected to type 'commerically'.

"When these mandates were established, no companies produced commercially viable cellulosic fuel. "

Geographically, not population wise.

You're not answering the question, what is the other choice to meet the mandates? Also do you know what "largely" means? I am fully aware that some tarriffs expired. Do you really think an import market develops like magic in a year's time when a simple political act can wipe it out in an instant?

>>

So you're saying the cite is a lie. Interesting tactic. How about this: Produce your alternative cite. Your declaration means nothing to me. RFS is either quoted as percentage of crop or a number of gallons of bio-fuel. Not a percentage of content in fuel manufactured.

Why should they? The fuel doesn't even exist in a commerical form.

Oh and here: "Corn surpluses have been at 15-year lows for most of the last two years due both to export demand and the fact that ethanol now consumes about

35 percent of the U.S. corn crop."

Which mandate? The RFS mandate or the Oxygenate mandate? And where's your cite? I don't believe you. Keep in mind that RFG mandates go beyond just the required areas. This has to be done from a fuel distribution standpoint. It is far too expensive to have so many formulations.

Cite? Of course not. As always.

You tell me. You are the one claiming the mandates must be followed.

> Oh and here:

That is an indication of market efficiency. The surpluses and stagnant prices that existed for 40 years before were the result of federal subsidies which have largely disappeared because the subsidies were triggered by low prices.

It also means that the US is now no longer funding the demise of third world agriculture like the Egyptian farmers that now live in Cairo slums because their fertile nile land was taken by the wealthy to build villas and golf courses due to a flood of cheap US corn in the 80's and

90's. Up until the last couple of years, farmers around the world have had to subsist for more than 40 years on producing grain at 1960 prices.

It also means that US consumers are not having as much fat and sugar funneled into their diets.

Corn ethanol production has exceeded all mandates for years.. There is no requirement for so many formulations in most of the country. Distribution costs are about geography.

The energy policy act of 2003 had mandates that would have required 5 bn gals ethanol by 2012 if it was still in force.

In 2005 when annual 2005 production was already approaching

5bn gals., Congress in the energy policy act of 2005, set the mandate for 2012 at 7.5 bn/gals

In 2007 when production was already close to 7 billion gals Congress set the mandate for 2015 at 15 bn gals. 15 bn gals is going to ve met in 2012. And that was despite a drought this year that cut corn production and saturation of the domestic market. Production would be higher still if outlets were not by law required to provide fuel with a limit of 10% ethanol content. The entire gasoline market doesn't have to be anywhere near 10% ethanol to meet oxegynate standards and yet it is.

Ethanol is added at the terminals. With modern automated blending as trucks are filled it would be dead simple to market less ethanol if the economics of blending were driving it in that direction. That is why it says on the pump "May contain up to 10% ethanol". If the ethanol weren't cheaper than the gasoline it would contain less ethanol.

Also if the EPA used ethanol blended fuel for its fuel efficiency ratings the auto makers would design engines that got better mileage on ethanol blends (like in Brazil) and having engines designed to be more efficient on ethanol would greatly increase the demand for higher ethanol content.

On balance the govt is now doing more to hinder ethanol production than to promote it.

It is also misleading to claim that 35% of the corn crop is diverted. One of the reasons corn ethanol is viable is that the process converts what would be high starch livestock feed to a high protein feed that is a valuable product in its own right. Distillers sell the high protein feed at close to 50% the cost of the input corn.