Joseph Miglietta On E85

Introduction

Joseph sent me the following two pro-E85 essays after I published E85: Spinning Our Wheels. I have broken up his posts into Part I and Part II. I may make some comments later, but for now I will simply post them as written (with a bit of formatting).

I plan on finishing up an essay specifically comparing the U.S. ethanol situation to that of Brazil, and hopefully will have it posted by the end of the week. I believe my calculations on this will provide a dose of reality to those who think Brazil’s ethanol program is the model for the direction we should take.

Anyway, here is the pro-E85 position from Joseph Miglietta.

Part I by Joseph Miglietta

E85 is an interesting subject, and I’m glad you brought it up.

First, I wish to comment on a minor detail. You relate ethanol to gasoline. You calculate an energy balance to produce ethanol from corn in terms of gasoline required to produce a unit amount of ethanol; yet, you make no comments about the energy balance to produce gasoline. Don’t you think you should also mention the fact that there are also energy requirements in terms of taking the oil out of the ground, hauling it by pipeline and ships, processing it into gasoline, and finally transporting the gasoline to final destination? This may bring the processing yield a little higher for ethanol. I don’t want to go into specifics, because I don’t know what these energy values are for gasoline, but I’m sure the data is available.

Corn is the only practical feedstock material we have for ethanol right now. But we are actively working on corn and cellulose technology to increase this energy balance and to make accessible other feedstock that farmers could grow instead of corn.

In your E85 essay, your contention that ethanol is not a viable solution for our country was pointed out before by Pimentel et al. (He was proven wrong) In terms of your energy balance, we may be better off consuming gasoline. I may go a step further: if we can hardly meet the national requirements for E10, what is the purpose of setting up E85 fuel pumps in half our gas stations by 2015. How can E85 lead us to our national independence, just like Brazil? Actually, not even Brazil has 50% fuel stations dedicated to E85, but only 40%.

I think we should look at this in a different perspective. (1) Let’s make most of our internal fuel engine vehicles as FFVs. The cost of these vehicles is practically the same as conventional vehicles; so, it won’t hurt either the manufacturer or the customer. Most of these vehicles will continue to use regular gas and maybe never will have a chance to use any combination of ethanol/gasoline blends, but the feature is there. (2) Let’s have even one single pump, or two back-to-back, at least at every third gas station dedicated to E85.

Now, the cost of installing a tank is a little expensive, but it’s a one-time investment with government’s help. It may not even be necessary to install a special tank. Perhaps the tank could be used interchangeably with gasoline alone, I’m not too sure. There are anticorrosive agents incorporated in the ethanol/gasoline blend to protect the tank. Or better yet, have a separate tank filled with just ethanol and a metering pump to dispense the required amount of ethanol with gasoline during the customer’s filling operation. These are simple ways.

But where is the ethanol? The ethanol will come later. First, let’s built the infrastructure. The dedicated E85 pumps will not be installed overnight either; it’s a gradual process over a few years. At the same time, also the amount of available ethanol will gradually increase. But we must maintain the presence of E85 throughout the nation and gradually increase it, not concentrated to the Corn Belt states.

Again the question, why E85 and not just E10 or E15? Because with E85 we shall become fuel independent, E10 or E15 won’t get us there. This is the goal we must set to achieve. We must not look at the small picture, the corn availability, but at the big picture: cellulose feedstock and ever-improving technology.

You said it yourself with other words, even if ethanol does not possess the same heat capacity as gasoline, if we were to have it in sufficient quantity, it would serve the same purpose. But even this problem may have a solution, at least in part. The heating value of ethanol, you said, is 67% that of gasoline (the value I come up with is actually less because I take the average value for gasoline, since it’s a variable mixture of components; but for our argument I prefer to take your value). Therefore, the more ethanol is present in ethanol/gasoline blend, the less is its efficiency. My additive increases the engine efficiency at the expense of heat. So, if this were applied, we would have still an added contribution, same as having a little more ethanol available, not to mention the savings at the pump and the incentive it may create.

I hope I made my point that ethanol is not much ado about nothing. It’s a liquid fuel as gasoline. It’s renewable. With ever-increasing technological improvement, we can produce it with less amount of oil, or with other sources of energy (but always mindful of environmental problems). In addition to the depletion problem of oil, we must look at a more pressing problem. The depletion problem is a few decades away (we have not reached a peak yet), but we have a more pressing problem now with our national security. From one hand we are fighting terrorism, from the other we are indirectly financing it. So, why not importing ethanol from friendly countries and reducing oil imports from unstable countries, at least until we become energy independent.

JM

Part II by Joseph Miglietta

Talking about the disadvantages of making ethanol from corn is like beating a dead horse. Neither ethanol from corn can be made efficiently enough compared to ethanol made from sugar cane, or it can be produced in significant quantities to replace our oil consumption. Understandably, many people feel it’s an affront to their intelligence when politicians speak as if corn ethanol were to be the solution to our energy problem. But that is not a sufficient reason for stopping us from producing ethanol, even from corn. The advantage of ethanol is that it can be produced from a variety of organic materials.

Grain stocks, such as corn, are not best suited for making ethanol from (wheat is even worse), but corn is what we have available for now, and we have always made alcohol from corn surplus. Until a couple of decades or so, most of the grain ethanol we produced was used for making beverages, in the pharmaceutical industry, and in many other industrial or domestic products. For those applications, the cost of producing ethanol is not as crucial as in its present application as a gasoline substitute.

Perhaps, Pimentel could have been right in saying that the cost of making corn ethanol by the conventional way (pre-1980) would be just as expensive as the starting material and the energy used (oil); therefore, we might as well use the oil to produce gasoline instead of bothering with making ethanol. But what Pimentel did not take into consideration were several factors, which somewhat offset his calculations: (1) we are constantly making progress in more efficient ways for making corn ethanol and reducing air pollution; (2) yields of corn/acre are increasing; (3) we employ domestic labor; (4) the cost for making gasoline from oil includes energy balance that is constantly increasing, such as: (A) transporting oil to terminals, (B) shipping oil to refinery, (C) refinery cost, including reformulated gasoline according to each state or regional requirements, (D) transporting gasoline to distribution centers, these among others. According to Michael Wang of Argonne National Laboratory, the energy used for each unit of ethanol has been reduced by about half.

One of the costs of ethanol in disadvantage over that of gasoline is transportation. Gasoline is transported by pipeline, ethanol by truck or by rail. The reason adduced is water by condensation in the pipelines. Water is insoluble in gasoline, in ethanol is most certainly soluble. I am no pipeline expert, therefore, I cannot argue this point properly with the oil companies, or their pipeline-companies affiliate. But maybe it is a valid point to look into it by some independent experts in this matter. My contention is, assuming that the amount of water incorporated in ethanol during pipeline transportation would be above the tolerance limit (1%), then why not run through the pipeline a certain amount of methanol prior to running ethanol. Water can easily be removed from methanol, which can then be used again. A better way, perhaps, is to run the ethanol through a dehydrating column at the other end of the pipeline. It is certainly worthwhile considering a feasible possibility to use pipeline for ethanol, due to the considerable difference in transportation cost.

But the most important factor is that corn gets us started in our quest for reducing our dependence on foreign oil. Undoubtedly, we need cheaper and more abundant renewable materials, and efficient methods for making ethanol therefrom, but we are actively working on them. Commercial application for cellulose-based ethanol from abundant feedstock, such as switchgrass and wood residue, may be available in a not-too-distant future.

I don’t think we’re placing the cart before the horse (again the proverbial horse). Waiting for developing a cellulose technology before establishing the necessary infrastructure is wasting precious time. The oil crisis is upon us. In the worse scenario, we would depend on ethanol imports to complement our own production. We would then still dependent on imports, but at least not from oil from unstable countries that support terrorism. The idea is to establish from the beginning the necessary infrastructure for the distribution of E85 nationwide. The presence of E85 pumps should be maintained nationwide, not just in the Corn Belt. As our technology progresses and we produce more ethanol, we increase the number of these pumps.

But E85 should be made available nationwide right from the beginning, so that people participate in our effort to become independent from foreign oil. Hence, we need to import as much ethanol as we can at the expense of the oil imported. We must reassure farmers that the amount of ethanol imported will not compete with what they produce. When ethanol from switchgrass or other cellulose material can be commercially made, farmers would then be encouraged to grow and harvest these products. More efficient processes are mushrooming everyday. There are already pilot plants in existence producing ethanol from these new materials. It’s just a matter of time before we reach a commercial stage. Ethanol may not be the answer for the long run, but it is the most practical solution at the present, and it’s going to stay with us for a while.

JM

Miglietta’s Closing Statement

Introduction

Joseph sent me a pair of essays: The one below and one on E85. I will post the one on E85 within a few days. I don’t plan to post a rebuttal to the following essay, but I will address one item in the comments below the essay.

Previous Essays

Ethanol Debate Challenge

Miglietta First Response

Rapier First Response

Miglietta Second Response

Rapier Final Response

Miglietta’s Second Response

My closing Statements On The Ethanol Debate

I am sure that in the coming years we will address conservation gradually ever more with more efficient, and fuel-diversified vehicles, including hybrids and plug-ins. Also, public transportation may assume a more important role. Oil reserves, even with China and India’s ever-increasing consumption, may last a few more decades taking into consideration the decreased consumption due to conservation. Coal is playing a more important role, directly, and indirectly through its byproducts. So, these two non-renewable sources of energy may sustain the world economy a while longer.

In the meantime, we are not sitting idle; we’re focused in finding cheaper and renewable sources of energy. I’m confident that long before we have exhausted these reserves, we have found effective solutions to our present energy problem without having to resort to mass transportation as our only solution left. There is no reason, therefore, to panic now. We will cross that bridge when we get there.

Ethanol, as a liquid fuel, may be a transitional solution, while better ways are found. It is a practical solution for the short-to-intermediate period, but only if it is made viable. It is ludicrous to consider corn as a viable material to make ethanol. It’s only a political platform. But it may serve as a starting point to use ethanol in our country.

Ethanol cannot be incorporated in gasoline blends in considerable amounts nationwide overnight. Even if we were to import ethanol, from Brazil for instance, they will require a long-term contract to increase their production to accommodate our demand. Brazil, however, can increase present sugar cane production even three folds. Currently, Brazil, as the U.S., is increasing ethanol production facilities; only Brazil has two big advantages over us: (1) they make their ethanol from sugar cane with a net energy gain of about 80%, and (2) they have 32 million cars on the road as compared to our 170 millions. Hence, they will have a surplus. So, ethanol imports could represent a viable, interim solution within the next three years. We cannot set a timetable on our research for more efficient production methods and for cheaper and more plentiful feedstock, but we are actively working on both. When this happens, corn won’t be used for making ethanol, except for moonshine.

JM

E85: Spinning Our Wheels

Introduction

The following is an expanded version of an essay that I posted to The Oil Drum entitled: E85: Spinning Our Wheels. The essay was inspired by comments made by Odograph over at The Oil Drum and at Gristmill. I have added a section at the end of the essay explaining the mathematics in detail.

How Much E85 Can We Make?

If you listen to the news lately, you know that E85 is going to lead the U.S. to energy independence, just like it did in Brazil. Senator Hillary Clinton has announced that she is getting into the act: (1)

"President Bush and other elected officials have called for a greater expansion of E-85, a fuel made of 85 percent ethanol that can be used in vehicles built to run on both regular unleaded gasoline and E-85.

E-85 is currently available in less than one percent of the country's gas stations, and Clinton wants to accelerate the spread of the fuel to half of the nation's gas stations by 2015 by offering a 50 percent tax credit for station owners who install ethanol pumps.

`We've got to take action on this pump issue or we're just spinning our wheels,' she said."

Just spinning our wheels. Indeed. But let's do a reality check and see whose wheels are spinning. These claims deserve a mathematical analysis, which none of the E85 proponents appear to have done.

According to http://www.corn.org/CRAR2005.PDF (2) (Warning: 1.9 meg file) the estimated corn harvest in 2005 was 10.35 billion bushels, and corn exports were 1.95 billion bushels. According to the 2002 USDA study The Energy Balance of Corn Ethanol: An Update, (3) you can get 2.7 gallons of ethanol from a bushel of corn. That means if we turned the entire corn crop into ethanol, we could make 27.9 billion gallons of ethanol. But as we all know, the BTU value of ethanol is around 67% that of gasoline, meaning that on a BTU basis this much ethanol is equivalent to 18.8 billion gallons of gasoline.

According to the Bureau of Transportation Statistics, our annual gasoline consumption is up to almost 140 billion gallons. (4) That means on a BTU equivalent basis, converting the entire corn crop into ethanol would amount to 13.4% of our annual gasoline demand. Putting all of that ethanol into the gasoline supply would mean ethanol could comprise 19% of the gasoline supply on a volumetric basis (while consuming all of our corn production). In other words, all of the gasoline in the country could be E19 if we wanted to use 100% of the corn crop. Of course if we only want to turn all of our current exports into ethanol (ignoring the many implications), that would amount to 2.5% of our annual gasoline demand. In that case, E10 could make up about a third of our gasoline supply on a volumetric basis. If we want to convert all of the corn exports into E85, it could make up 3.3% of our total gasoline pool.

But that's the good news. According to the previously mentioned USDA study, it takes 77,228 BTUs of fossil fuel inputs to make 83,961 BTUs of "green, renewable" ethanol. Ignoring co-products for a moment, that means the created energy was a mere 8% in excess of the input energy. Given that the fossil fuels (primarily natural gas) that went into making the ethanol can usually serve as transportation fuels, the amount of transportation fuel that is displaced is only the 8% that was "created". That means that in reality, using our entire corn crop would only displace 1% of our annual gasoline consumption. If we only decide to use our exports, the net displacement of gasoline would be 0.2% of our annual gasoline consumption.

Now, a word about co-products. Energy balance studies of grain ethanol almost always include a BTU credit for the co-products (mostly animal feed). I think this is appropriate, provided that a proper analysis is made of the energy inputs into the products that were displaced. Let's ignore for a moment the fact that some estimates indicate that the "byproduct markets could saturate well short of 11 billion gallons of production". (5) Let's give full credit for the byproducts, just as if they are liquid fuels to be burned. This has no effect on the BTU equivalent calculation, but will affect the displacement calculation. With by-products included, the USDA report has 77,228 BTUs of fossil fuel inputs for 98,333 BTUs of total outputs. In this best case scenario, the ratio of energy out/energy in is 1.27. Converting 100% of the corn crop into ethanol, presuming we had a market for the byproducts, would then displace an incredible 2.0% of our annual gasoline consumption.

So, why the big rush to get E85 pumps at 50% of the nation's gas stations? We can't possibly produce enough E85 to justify putting in all those pumps. Wouldn't it be much better just to push for E10 at more locations? In that case, expensive new pumps are not required, and E10 can already be burned in most vehicles on the road. Or how about encouraging more natural gas vehicles, instead of inefficiently and expensively turning natural gas into ethanol? But I suppose those would be rational solutions, as opposed to feel-good solutions that promise energy independence.

Conclusion

There are a couple of things to conclude from this exercise. First, the "E85 everywhere" push is much ado about nothing. E85 can’t contribute enough to the gasoline pool to justify putting pumps everywhere. Second, it should be clear that ethanol is not going to make us energy independent. It is time to stop believing that Brazil is energy independent because of ethanol, and realize that it is because their energy consumption is 1/6th of ours in the U.S. If we reduced our energy consumption by that amount, we would be energy independent as well. Finally, it should be clear that we are going to have to take conservation seriously. Ethanol may make some sense in certain parts of the Corn Belt. It is an impractical solution nationwide, and won’t ever contribute more than a small fraction of our fuel needs (barring a breakthrough in cellulosic ethanol technology).

Mathematical Details and Notes

The estimated corn harvest in 2005 was 10.35 billion bushels and corn exports were 1.95 billion bushels.

According to the USDA, you can get 2.7 gallons of ethanol from a bushel of corn.

2.7*10.35 = 27.9 billion gallons of ethanol.

2.7*1.95 = 5.3 billion gallons of ethanol.

The higher heating value of gasoline is 125,000 BTUs/gallon, and for ethanol it is 83,961 BTUs/gal. This means that ethanol has 67% of the energy value of gasoline.

If we introduce ethanol into the fuel supply, we will need 1/(0.67), or 1.49 gallons of ethanol for every gallon of gasoline that is taken out of the gasoline pool.

U.S. fuel consumption is currently around 140 billion gallons. If we put the 27.9 billion gallons of ethanol (from the entire corn harvest) into the gasoline pool, it will only have the energy equivalent of 27.9*0.67, or 18.8 billion gallons of gasoline. This means the motor gasoline pool will have to increase to 140 - 18.8 + 27.9, or 149.1 gallons. Therefore, to maintain the same number of BTUs that we have today in the gasoline pool, and by converting 100% of the corn crop into ethanol, it could make up 27.9/149.1, or 18.7% of the gasoline pool on a volumetric basis. However, as was discussed above, ethanol only has the energy value of 67% of gasoline’s, so the net BTU contribution (the important piece) is 18.8 billion gallons of a 140 billion gallon gasoline pool. This is equivalent to 13.4%. Doing the same calculation for just our corn exports shows it could make up 3.5% on a volumetric basis, or 2.5% on a BTU equivalent basis of our current gasoline pool.

Regarding the displacement calculation, there is an excess of 8% energy created when a gallon of ethanol is produced (ignoring co-products for the moment). This is because fossil fuels had to be input into the process. When the input fossil fuels are natural gas, diesel, or gasoline, they can serve as transportation fuels themselves. In that case, the net to the gasoline pool per gallon of ethanol is only 8% of the ethanol produced. 8% of 18.8 is 1.5 billion gallons of net energy production. 1.5 billion gallons/140 gallon gasoline pool is a 1.1% net BTU contribution for turning the entire corn crop into ethanol.

References

1. "Senator Clinton Pitching Ethanol Energy Plan", Yahoo News, May 23, 2006.

2. "Corn: Part of Our Daily Lives", Corn Refiners Association Annual Report, 2005. (Warning: 1.9 meg file)

3. Shapouri, H., et al., "The Energy Balance of Corn Ethanol: An Update", United States Department of Agriculture, AER/813, 2002.

4. "Estimated Consumption of Alternative and Replacement Fuels for Highway Vehicles", Bureau of Transportation Statistics, 2005.

5. Lave, L., and Griffin, W. M., "The Green Bullet", Foreign Policy, March 7, 2006.

Rapier Second Response to Miglietta

In Joseph’s second response, he didn’t bring up new material related to ethanol that wasn’t addressed in my first response. He did bring up some other issues that are worth addressing, but this response will be briefer than my initial reply. Joseph's responses are in block quotes below.

JM: Mass transportation has been around with us even before the advent of personal vehicles. I find mass transportation acceptable as a free choice but not as an imposing substitution to our personal vehicle. If the time came that we no longer have this choice, then I consider we reached a point of regression; we have failed in our ability to make technological advancement. But I consider our resourcefulness inextinguishable.

The problem is that we just don’t have an energy-dense fuel like oil with which to power our society. We are withdrawing deposits that were made over eons of time, and we aren’t replenishing them. From my viewpoint, the post-oil world is going to enforce a drastically reduced energy budget for everyone. Governments can delay the day of reckoning by adopting aggressive policies to encourage conservation.

JM: First of all, there is still a lot of oil underground to sustain our needs for a few more decades. In the meantime, we’re making progress.

There will still be oil in the ground in a few decades. However, we won’t be able to get it out fast enough nor economically enough to sustain our present energy desires, especially given the growth in China and India. After all, oil production in Texas peaked in 1970, and 36 years later there is still oil underground in Texas. But it isn’t nearly enough to sustain Texas. Oil from the tar sands fields of Canada is now flowing south into Texas.

JM: In my opinion I believe, you use a negative approach: we must conserve, you say, "because we simply can’t get the energy we need. No alternatives can meet our current energy desires." We must conserve, while our efforts in finding alternative fuels are intensifying.

In my opinion, I am using the realistic approach. You hold out hope that fusion will come online and save the day. Or, barring that, some other alternative is out there, and just needs to be discovered. Fusion may some day prove to be viable, but we can’t depend on it to mitigate the liquid fuel shortfall that is happening even now.

I say with confidence that our society will never find an alternative liquid fuel with the economic advantages of petroleum. The solar energy of many years of plant growth was captured, and heat from the earth was added to the mix as it was buried. Nobody had to plant it, and nobody had to harvest it. The earth was the chemical reactor that heated and compressed the plants, turning them into an energy dense mixture. Each year we make withdrawals from the fossil fuel bank that can’t be replenished any time soon. In the past 260 years, we have burned the equivalent of 13,300 years of the entire earth’s plant material. (1)

But in the future, we are going to have to rely on short-term deposits to sustain us. This is going to mean we are going to have to learn to reduce our energy consumption, and probably spend a substantial amount more of the world’s manpower in creating the energy needed to sustain society.

JM: As in the past, when there is a need, we will fill it with better product(s). Liquid fuel is our most immediate and practical approach, even if this alternative fuel has less energy than gasoline.

The critical issue is not how much energy the alternative contains, but how much energy it takes to make it, and where that energy comes from. We could convert our society to run on a fuel with 1/10th the energy density of gasoline, if the energy inputs required to make it were low enough.

JM: There is no need to discuss any further the disadvantage offered by producing ethanol, its energy balance, farm land availability in our country, etc. Ethanol, however, is a starting point.

My argument in discussing all of ethanol’s disadvantages, which you did not address, goes to demonstrate that ethanol is a really poor starting point. As I pointed out, we would be better off just using the natural gas that goes into making ethanol and power vehicles directly from that.

JM: The oil companies are now pressed for ethanol. What we need is to reassure the farmers that importing ethanol will not go against their interests—a quota system should be established to import only the ethanol they cannot produce.

The time has come to stop coddling ALL of these special interests, and start implementing policies that will be benefit our children and grandchildren. We have to take the long view. Failure to do so is why we find ourselves in the present situation.

JM: In my view, this report from Argentina is groundless and serves political purposes, since Argentina is not in the same conditions as Brazil both for oil and for ethanol.

To be clear, that report was a story that was written by David Victor, the director of the Program on Energy and Sustainable Development at Stanford University. It was merely reprinted in an Argentinean newspaper.

With that, I think I will conclude. My objections to ethanol from my previous essay were not addressed, so there is no need to continue reiterating those points. If Joseph would like to offer up a closing statement, I will post it. Otherwise, I appreciate the exchange of ideas.

Reference

1. Kruglinski, Susan, “Discover Data: What’s in a Gallon of Gas?”, Discover, April 2004.

Miglietta’s Second Response

Introduction

Joseph sent the response below via e-mail. I have done a bit of formatting, but otherwise it is exactly as received. I will respond by the end of the week. As always, feel free to add your comments following his essay.

Joseph’s first reference is a paper written by him that I have hosted for now at Sharelor. I learned today that it is very difficult to find a free file hosting service. The first one I tried made you wade through a ton of ads. The second had porn popups, which wasn’t apparent until you were trying to download the file. Finally, I found Sharelor, which is actually pretty good. The file is a 1.2 meg PDF. It is quite well-written, and details his work with fuel additives. (If anyone wants to host Joseph’s paper permanently, let me know and I will change the link).

Related Essays

Ethanol Debate Challenge

Miglietta First Response

Rapier First Response

Miglietta’s Second Response

I just finished reading your response. Congratulations are in order for your stout position. I am responding by email because you do a great job in formatting (among other things).

As a premise, I wish to say that I have an indirect interest in alcohols (not necessarily ethanol alone) and therefore somewhat biased. My direct interest is in increasing the engine efficiency for alcohol blends with gasoline, buttressed by my findings. (1) I feel, however, I can still participate in this discussion with an open-mind position.

In principle, I hate waste. I’m all for conservation of energy that is wasted in transportation. Several solutions may be on hand: Combining more than one chore in a single trip, whenever feasible, improving vehicle efficiency, find alternative fuel sources, find new types of vehicles, such as hybrid cars, etc. Car-pooling, however, already implies a certain amount of sacrifice that not everybody is willing to accept. Mass transportation has been around with us even before the advent of personal vehicles. I find mass transportation acceptable as a free choice but not as an imposing substitution to our personal vehicle. If the time came that we no longer have this choice, then I consider we reached a point of regression; we have failed in our ability to make technological advancement. But I consider our resourcefulness inextinguishable.

On the long run we may tap on fusion energy. We have come a long way since the first magnetic fusion containment made in France that lasted a fraction of a second. We are actively pursuing the two paths: magnetic fusion energy (MFE) and inertial fusion energy (IFE), the latter is more for military applications. MFE has already been demonstrated that is both scientifically and technically achievable, and IFE may be achieved in 2008. There are problems still to be solved for MFE, among others: maximizing the pressure of plasma held in the confining magnetic field, and achieving stable, steady-state operation in the self-heated plasma for an efficient conversion of neutron energy to electricity. Nuclear fusion will provide safe and inexhaustible electrical energy without atmospheric emission. Research funding, however, is relatively small and has been cut back during this administration. In Europe, instead, this application is actively pursued. When electricity will be affordable and available to the entire world, plug-in cars would be the personal transportation of the future. For now, however, electricity is still very expensive, a good portion is still made from natural gas. So, in my opinion, plug-ins are still not much an advantage over gasoline. Plug-in vehicles are still very expensive and will remain so until more efficient and cheaper batteries are developed.

For the afore said, I disagree with your statement, "In the long-term, our energy needs must be met with sustainable solutions. The status quo can’t be maintained, because there is simply no alternative out there that compares to pumping an energy rich liquid fuel right out of the ground." First of all, there is still a lot of oil underground to sustain our needs for a few more decades. In the meantime, we’re making progress. I agree, we must conserve. But conservation is a natural course of action that people opt for when facing with high prices. When the price of gasoline is high people will, as in the past, resolve to buying less gasoline-guzzler cars, and take other measures. But it should not be imposed on us, as by government decree, to use public transportation. In my opinion I believe, you use a negative approach: we must conserve, you say, "because we simply can’t get the energy we need. No alternatives can meet our current energy desires." We must conserve, while our efforts in finding alternative fuels are intensifying.

This crisis is spurring our ingenuity. As in the past, when there is a need, we will fill it with better product(s). Liquid fuel is our most immediate and practical approach, even if this alternative fuel has less energy than gasoline. Methanol has less than half the heating capacity of gasoline, but it offers other advantages: it can be readily produced, it does not have to be farmed, and we have the world’s largest supply of starting material to last us well into next century. But it has a single big disadvantage: it does not have the lobbying support of ethanol. So, we must go around it.

There is no need to discuss any further the disadvantage offered by producing ethanol, its energy balance, farm land availability in our country, etc. Ethanol, however, is a starting point. Lets have the necessary infrastructure: distribution, fuel stations, and flex-fuel vehicles. Let’s play along with the farmers. When the demand for ethanol is higher than what they can produce, or to farm corn for ethanol, the same legislation that they pushed for is going to work against them. Hawaii, for instance, cannot produce yet enough sugar cane, so they resorted to import ethanol.

The oil companies are now pressed for ethanol. What we need is to reassure the farmers that importing ethanol will not go against their interests—a quota system should be established to import only the ethanol they cannot produce. When we have the necessary infrastructure, gradually, instead of importing more ethanol, we produce methanol, or produce ethanol from other sources.

We are working on farming other sources of starch. As I have indicated before, they are even studying a process to produce starch from algae, Veridium Bioreactor Technology, claims to produces 94% starch vs. 63% obtained from corn and without the use of farming land. (2) So, many things are in the works to gradually substituting at least a portion of gasoline.

So, long before we exhaust our resources, we may have the cheapest and inexhaustible energy source: electricity from nuclear fusion. This has been going on for several decades, but we have made significant progress and we seem to be much closer to reaching this goal. Of the two paths: magnetic MFE and inertial fusion IFE, the latter seems to be less likely to be used in actual fusion research, due to its low energy. (3) But attempts to combine the magnetic confinement MFE with the laser-driven fusion implosion of the inertia confinement IFE may overcome some of the problems encountered with MFE. (4) The object is to achieve stable, steady-state operation in self-heated burning plasma for an efficient conversion of neutron energy to electricity. Within a decade, ITER (International thermonuclear experimental reactor) will produce the first sustained fusion reactions before a commercial prototype. Nuclear fusion offers zero green house emissions and does not lead to large storage of nuclear waste as the nuclear fission plants currently in operation. (5)

We are experiencing now literally an explosion over the Internet of reports of new findings. Small accelerators that could fit on a desktop, are now being proposed. They offer a single pass linear acceleration for plasma to increase its desired density—fast particle accelerator near the speed of light—a net departure from the mainstream toroidal Tokomak machine to meet the required conditions for a self-sustained reaction. This is to show we are actively pursuing our energy dream of abundand, accessible worldwide energy and making fast progress towards its realization.

In the meantime, we could use the alternative fuels we have now on hand. I stressed the point of importing ethanol. The energy balance does not work out the same in Brazil as in the U.S. First, cultivating sugar cane by rotation, harvesting sugar cane, fermenting higher-than-corn ethanol yield from raw sugars (including invert sugar) offers a significant advantage. Moreover, sugar/ethanol mills offer a significant energy balance: they are self-sufficient. They produce the required steam and generate even excess electricity for the grid or to sustain the surrounding village of workers from burning bagasse in their boilers. They are actively researching to utilize both stems and leaves to produce more ethanol. Their mills can produce interchangeably sugar or ethanol according to market conditions, and if they succeeed in producing ethanol from the vegetable residue, eventually they will be able to produce simultaneously both ethanol and sugar.

There are vast territories in the state of Sao Paulo that can be turned to sugar cane cultivation to meet more demand. I have not heard of their intentions of reducing the ethanol production. They are self-sufficient for oil too, thanks to their advanced technology for off-shore drilling. In fact, Petrobras, their government-owned and only oil company, has interests and platforms in the Gulf of Mexico.

But they are using a minimal amount of gasoline for domestic production. At the pump, regular gas is blended with 10% ethanol (E10), but most popular are E85 and E100 used by flex-fuel vehicles. GM, Ford and Volkswagen are the car manufacturers marketing FFV’s. They made a simple, and inexpensive adaptation to their flex-fuel vehicles to burn straight ethanol. By law, no car can have a diesel engine. Diesel is reserved only for heavy-duty trucks or buses. I don’t think that this measure encourages oil products over ethanol. Petrobras is the only authorized distributor and exporter of ethanol in addition to their oil products. They have about 33,000 fuel stations as compared to our 140,000, of which only about 600+ are dedicated also to E85 in our country. In my view, this report from Argentina is groundless and serves political purposes, since Argentina is not in the same conditions as Brazil both for oil and for ethanol.

Presently, we are at the beginning of a state of energy turmoil. If disappointed taxpayers continue their pressure and complains in an election year we may be able to see some results. People, the media, and the politicians should be made aware of the stark facts. Supporting the farmers and increasing ethanol production is like a drop in the bucket. We must import the needed ethanol, while we find new sources and establish the needed structure. Oil companies should provide ethanol/gasoline pumps at their gas stations and car manufacturers to produce a great deal more flex-fuel vehicles. The contribution that hybrid and plug-in cars can provide is for now very limited. These vehicles can be made more affordable as production increases, but the real bottleneck is batteries.

Much more can be said. I think that events will take their natural course. In a little way, I am trying to make a contribution…

JM

References

1. Miglietta, J., "A New Fuel Project". Download Warning: 1.2 meg PDF; also a 30 second wait before download begins. Update on 6-2-06: I just checked, and the file is no longer at Sharelor. If you want a copy, e-mail me and I will send it to you, or I can put you in touch with Joseph.

2. "Veridium Amends License Agreement for Exclusive Rights to CO2 Bioreactor", Yahoo! Finance, April 18, 2006.

3. "Nuclear Fusion Power", World Nuclear Association, June 2005.

4. Hammer, James, et al., "High Density Magnetic Fusion", Lawrence Livermore National Laboratory.

5. "France gets nuclear fusion plant", BBC News, June 28, 2005.

Peak Oil Primer

Peak Oil Primer

I have written a comprehensive Peak Oil primer for OmniNerd . The article is What You Need to Know about Peak Oil. I attempted to write it from a completely objective viewpoint, by presenting both sides of the argument. I also run down the potential for the contenders vying to replace oil. In reviewing the article after publication, I would say the one thing I probably didn’t go into enough detail on was the negative side of tar sands. I had been working on the article for a month at that point, and sort of rushed through that one without realizing that I hadn’t adequately addressed both sides.

Check it out and let me know what you think.

New Response from Joseph Miglietta

Joseph e-mailed me a new response last night supporting his position on ethanol. As soon as I get it formatted, I will post it. He sent an attached PDF that he authored as one of his references, and I need to find a place to host it so others can access it. It is quite good. Expect to see the article posted later today, or tomorrow.

Spammer Attack

I finally got hit by a spammer yesterday. Someone posted 26 ads in the comments sections at the end of my essays before I caught it. Therefore, I have now enabled "word verification" for comments, just like most other bloggers. I want to make commenting as easy as possible, but I don’t want to have to go in and individually delete a couple dozen ads again.

RR

XTL: Promise and Peril

The following is a slightly modified version of an essay that I posted to The Oil Drum .

Introduction

I have stated on several occasions that I believe global warming is a greater immediate threat than Peak Oil. As long as the demand is there, energy companies will strive to supply fuel to the marketplace. To meet the demand, we will develop tar sands, while consuming enormous quantities of natural gas. We will turn natural gas (or even coal) indirectly (and inefficiently) into ethanol. Finally, we will turn vast quantities of carbon into fuel via what I term "XTL" technologies. XTL technologies consist of a partial oxidation (POX) reaction followed by the Fischer-Tropsch (FT) reaction. When the POX feedstock is natural gas, this is referred to as a gas-to-liquids (GTL) process. If the feedstock is coal or biomass, this is referred to as CTL, or BTL respectively.

I won’t go into a detailed explanation of the POX and FT reactions. What I will give is a quick, layman’s overview. When a hydrocarbon material is burned (e.g. natural gas, coal, biomass, etc.), it can be completely oxidized (combusted) to carbon dioxide and water, or it can be partially oxidized to carbon monoxide and hydrogen. The latter POX reaction is accomplished by restricting the amount of oxygen during the combustion, and it is a potentially deadly reaction should it inadvertently occur inside your home. The resulting mixture of carbon monoxide and hydrogen is called synthesis gas (syngas) and can be used in the manufacture of an abundance of organic compounds.

The FT reaction is a bit more complex than the POX reaction. You can find in-depth information on the FT reaction here. In short, the FT reaction converts syngas generated via the POX reaction into a distribution of long-chain hydrocarbons. Hydrocarbons in the diesel fuel range are very common, making this reaction an ideal way to extend the fossil fuel economy.

The Promise

At present, the economics for GTL are far more favorable than for CTL or BTL. There are enormous reserves of natural gas throughout the world. Worldwide reserves of natural gas are estimated to be 6,200 trillion cubic feet, of which 3,000 trillion cubic feet are estimated to be stranded. (Reserves are considered to be stranded if it is uneconomical or impractical to get them to market.) This is enough stranded natural gas to produce 300 billion barrels of fuel, according to Syntroleum (Warning: It's a 3.4 meg PDF).

GTL is not a pipe dream. The process is technically viable, having been demonstrated on numerous occasions. It is economically viable depending on the price spread between natural gas and oil. Despite the fact that the capital costs for GTL plants are approximately twice those of conventional oil refineries, a number of projects have been announced in Qatar. Plants are being built, and the fuel produced will help supply some of the shortfall that Peak Oil will generate.

The Peril

Of course there is a catch. GTL is not all that efficient. There are efficiency losses during both the POX and the FT processes. It would be far more efficient to run automobiles directly on the natural gas. Due to the fact that the gas is stranded, this is obviously not an option. But the efficiency losses are significant. According to the Syntroleum link, it takes 10,000 cubic feet of gas to make 1 barrel of fuel. 10,000 cubic feet of natural gas contain roughly 10 million BTUs, but a barrel of fuel contains only around 5.5-6 million BTUs. Forty percent of the BTUs are either lost as radiant heat, or turned to steam and consumed in the GTL plant. Unless carbon sequestration is in place (unlikely), all of those BTUs ended up as carbon dioxide in the atmosphere. On top of that, the BTUs from the barrel of fuel are going to end up as carbon dioxide in the atmosphere once the fuel is burned in an engine.

The reason I find this more worrisome than Peak Oil is that I believe this path is inevitable, yet the consequences are unpredictable. We will make and use GTL fuel, as inefficient as it may be. Our carbon dioxide emissions are likely to accelerate in our quest to maintain affordable energy. As stranded gas supplies are consumed and GTL production peaks, there is CTL, with the same efficiency problems, waiting in the wings. From my view, the fossil fuel economy will be with us for a long time to come.

Look at the figure below, and think of the experiment we are conducting. Atmospheric carbon dioxide levels are at their highest levels in human history. The trend in the graph shows a linear increase in atmospheric levels. The trend didn't deviate at all during the oil shocks of the 70's.


Source: National Oceanic & Atmospheric Administration

I believe I can see the foresee the consequences of Peak Oil. It certainly won’t be a picnic. But I think I can plan for it, and I believe that we will eventually adjust to a post-oil world. But I can’t foresee the consequences of warming the earth up by 5 or 10 degrees C. Humanity has never had to deal with this problem. The Sahara Desert was once lush with vegetation and teemed with wildlife. Consider the impact if this is the fate of the Corn Belt of the Midwest. Yet I see nothing to indicate that we are going to veer from the course we have set.

Rapier Response to Miglietta

Introduction

First of all, I would like to thank Joseph Miglietta for taking up my Ethanol Debate Challenge. I firmly believe that the best way to get to evaluate some of these claims is by having an open debate, with both sides presenting their arguments, and defending them from criticisms. If you are already an ethanol believer, you aren’t going to be convinced by FAQs from the American Petroleum Institute. Likewise, if you are already an ethanol skeptic, you aren’t going to be convinced by FAQs from the American Coalition for Ethanol. But, head to head exchanges offer a chance to critique the other side and determine whether the arguments hold up.

I agree with some of what Joseph writes, and on other parts I don’t feel strongly one way or another. I will only address those arguments that I feel need rebutting. But first, I will open with a brief statement explaining my position.

My opposition to ethanol is primarily due to the inefficiency of the process. My opening commentary here is primarily aimed at grain ethanol. I know Joseph acknowledged that this is not the best way, but it is the way we are subsidizing and promoting it here in the U.S. To make ethanol, we use petroleum-fueled tractors to plow the fields. We apply petroleum-based herbicides to kill the weeds. We apply petroleum-based pesticides to kill the bugs. We apply petroleum-based fertilizers to feed the plants. We harvest the corn with petroleum-fueled tractors, and ship the corn to the ethanol plants in petroleum-fueled trucks. The ethanol plants are natural gas hogs, consuming enormous quantities to ferment and purify an ethanol solution that is primarily water. We then ship the ethanol, often halfway across the country, in petroleum-fueled trucks. The customer on the receiving end pays less than market price for the ethanol, due to the subsidies, which are paid by taxpayers. Then, they suffer a decrease in gas mileage, meaning they have to fuel up more often.

Some of the proponents think switching to ethanol is a way to "stick it to Big Oil". What they overlook is that Big Oil benefits greatly at all steps of the ethanol process. They make the fossil fuels that drive the tractors. They supply the petrochemicals that make the fertilizers, pesticides, and herbicides. And who do you think is the largest natural gas producer in the U.S.? I will give you a hint: One of the members of "Big Oil".

The energy balance of ethanol has been much discussed, but here is the problem in a nutshell. Let’s look at the 2002 USDA study on the topic. If you look at Table 1, you will see that the USDA authors estimate fossil fuel inputs of 77,228 BTUs to make 84,100 BTUs of ethanol. So, the energy balance would be a positive 9%. They report a positive balance of 34%, but that's because they include some BTU value for co-product credits (animal feed). But as far as fossil fuels in and ethanol out, it's 9%. (However, the USDA did admittedly omit some energy inputs, so it is still possible that the energy balance is actually negative). In a later 2004 publication, they played with the math a bit, assigning a large fraction of the energy inputs to the co-products. This allowed them to claim 67% energy returned, but is merely an accounting trick that I addressed here.

Often overlooked in these analyses is the fact that soil is eroded during the process of growing the corn, and pesticide, herbicide, and fertilizer runoff all end up in our waterways. So, in light of all this, I have to ask if it actually makes sense to support such a process. Wouldn’t we be far better off just using the natural gas to directly fuel our vehicles? Every step in the process of making ethanol has efficiency losses. The more steps in the process, the higher the efficiency losses. Every BTU of heat that ends up radiating into the environment during the process is a BTU that did no useful work. By directly using the natural gas to fuel the vehicles, the cost would be far lower to the consumer and the taxpayer, and the efficiency much greater. Billions of dollars of subsidies would be eliminated in the process. Why, oh why do we continue down this insane path?

Next, I will address some specifics from Joseph.

Response to Specific Arguments

JM: Especially here in the South where I now live, people’s knowledge on this subject is abysmal. So, if by means of these debates we can contribute a little to this effect, I would feel rewarded.

The problem is not limited to the South. It is ubiquitous. The media and the politicians seem to understand very little about this issue. Above, I asked the rhetorical question of why we continue down this path. The answer is that people are generally uninformed with respect to ethanol. They often have certain cherished beliefs that they have not been forced to defend. Therefore, they continue merrily along in the belief that ethanol may in fact be the solution, or a substantial part of the solution to our oil dependence.

JM: Conservation could be a solution to the oil crisis; it would also help traffic congestion, not to mention the lessening of environmental problems. But in my opinion, it is a step backward in our progress. Crises offer incentives for improvement; going back, instead, imply defeat.

I strongly disagree. In the long-term, our energy needs must be met with sustainable solutions. The status quo can’t be maintained, because there is simply no alternative out there that compares to pumping an energy rich liquid fuel right out of the ground. We must conserve. We can do this voluntarily, and government can pass policies to encourage us to do so. Otherwise, we will do it involuntarily, because we simply can’t get the energy we need. No alternatives can meet our current energy desires. Conservation has to be instilled in every one of us.

JM: Of course, producing ethanol from grain (corn) is not the best way. In general, producing ethanol from starch is by far less energy efficient than from sugars. If all the arable land in our country would be cultivated for corn for ethanol production, it would hardly make a significant dent in our fuel consumption. (I am exaggerating here a little to stress my point).

That’s just the thing, though. You really aren’t exaggerating at all. We might be able to produce 10 billion gallons of ethanol. If we turned 100% of the corn crop into ethanol, we would produce the equivalent of less than 15% of our annual gasoline consumption. However, that is not on a net basis. On a net basis, since you consumed fossil fuels that could have been used as transportation fuels, in reality you would displace less than 5% of our energy consumption by turning 100% of the corn crop into ethanol.

JM: A 10% incorporation of ethanol in gasoline, or E10, may sometime in the near future be nationwide. Sure, we can achieve this only by government subsidy, but it’s a start. Subsidies are supposed to be temporary measures. In the meantime, this will create an incentive to find more efficient ways to handle starch.

These subsidies started being handed out almost 30 years ago. Yet today, the entire ethanol market is still dependent upon continuation of these handouts. It simply can’t exist without subsidies or mandates, and people should ask why. What they will find is that it is because ethanol is so dependent upon fossil fuels for its manufacture. People expect the process to improve, and thus ethanol will become cheaper, but they overlook the fact that the fossil fuel inputs will really drive the price of ethanol higher as oil becomes more scarce. The fact of the matter is that ethanol is primarily a fossil fuel, because that’s what it is made from.

JM: Research is being conducted to use cheaper starting materials.

I agree that cellulosic ethanol offers more hope. I think research in this area should continue to be generously funded. However, unless the fossil fuel inputs can be substantially decoupled from the ethanol production process, or the energy balance can be significantly improved, then ethanol of any sort will be a dead end. The energy balance for cellulosic appears to be better, but other factors have inhibited market penetration. So, it is worth further pursuit, but we need to rigorously evaluate the claims.

JM: We are pressed with time in view of the mounting competition for oil from China and India, its spiraling prices, global warming, not to mention that we are indirectly financing terrorism. For these very reasons, we need to import ethanol and reduce the import of oil.

Given the marginal energy balance, there is little to no global warming benefit. If you saw the recent 60 Minutes special, you saw ethanol proponent Daniel Kammen say that the greenhouse gas reduction would be "modest". That comment right there should tell you just how "renewable" ethanol really is. Note that this does not even factor in the greenhouse gas emissions from the by-products, which cause cattle to emit more methane – a far more potent greenhouse gas than carbon dioxide.

JM: One of the reasons I content is why we impose a tariff on a cleaner fuel imported from friendly countries and import tariff-free oil from rogue countries. The reason should be obvious: oil companies are the powerful force behind. Their tactics is simple: increase the price of gasoline at the pump, and then decrease it by a few cents to pacify the animosity of the public. But oil companies are not the only force against ethanol imports.

Sorry, but this one falls entirely at the feet of ethanol producers. They are the ones who lobbied against the bill to drop the ethanol tariff. Since ethanol is mandated, oil companies want to find the cheapest source of ethanol they can find. It is of no benefit to them to lobby against the tariffs. Perhaps you caught this recent story: Boehner won't push to cut ethanol tariff Some excerpts:

WASHINGTON (Reuters) - In a big win for U.S. ethanol producers, House Majority Leader John Boehner said on Monday he will not push legislation to reduce the U.S. tariff on ethanol imports.

U.S. oil refiners are scrambling to secure ethanol supplies to mix with gasoline this summer as they switch from using the water-polluting fuel additive MTBE. But the Energy Department has warned that U.S. ethanol supplies will fall short and refiners will need to rely on more imports.

Farm state lawmakers, whose corn-grower constituents supply the feedstock for making the vast majority of U.S. ethanol, strongly oppose easing the U.S. tariffs on foreign, and therefore competing, ethanol shipments.

"Boehner has always been an ardent supporter of the ethanol industry," his spokesman said. "The industry is important for strengthening the economy in rural America and weaning the U.S. from its dependence on foreign oil."

The Renewable Fuels Association, the ethanol industry trade group whose members include giant agriprocessor Archer Daniels Midland Co., said in a recent letter to House and Senate leadership that "removing the tariff will have no impact on what American drivers are paying at the pump."

Oil producers want the tariffs suspended. Consumers want them suspended. Ethanol producers don’t.

JM: Brazil has much less cars than us, and a vast territory with ideal climatic conditions for sugar cane. Consequently, they have a surplus of ethanol and they can easily meet an increased demand.

In response to that, I submit some quotes from Brazil's Ethanol Lesson Is How to Manage Our Oil Addiction:

In reality, ethanol is a minor player in Brazilian energy supply. It accounts for less than one-tenth of all the country's energy liquids. The real source of Brazil's self-sufficiency is the country's extraordinary success in producing more oil.

Yet, even with Brazil's favorable climate and sugar's inviting biology, ethanol is already reaching the limit. That's because the land and other resources devoted to ethanol can be put to other uses such as growing food and cash crops.

Indeed, today the Brazilian government is actually reducing the share of ethanol that must be blended into gasoline because sugar growers prefer to make even more money by selling their product as sugar on the world market rather than fermenting it into alcohol.

JM: I know no other alternatives for ethanol; better perhaps, but not as commercially readily available as ethanol. Eventually, ethanol will be phased out but I don’t think this will happen for many years to come.

How about Plug-In Hybrids (PHEVs)? How about lowering the speed limit? How about raising CAFE standards to European levels? How about more tax incentives for purchasing fuel efficient vehicles ? Those are all better uses of our alternative energy dollar than a scheme to turn natural gas and petroleum into ethanol via a process that has a marginal energy return.

JM: E10 will not make us energy independent. But E85 would.

No, it wouldn’t. We consume far too much fuel, and can’t make enough ethanol. Realistically, it would be difficult for us to get to a 15% ethanol blend nationwide.

JM: I use the word "alcohol" to include methanol, which could be produced from coal, and we have the world’s largest reserve of it. The technology has not yet been developed, however.

Sure it has. This is how Sasol produces methanol in South Africa. There is nothing at all that is complex about it; it's just easier to use natural gas than coal.

With that, I will close. If you wish to continue the exchange, please respond in the comments section, or e-mail me your response. I will get it formatted and posted within a few days.

Wednesday Quick Hits

Plug-In Hybrids

The more I learn about plug-in hybrids (PHEVs), the more convinced I am that this would be a far better use of our alternative energy dollar than subsidizing corn ethanol. Learn All About Plug-In Hybrids (PHEVs) here.

Thanks to Leanan at The Oil Drum for highlighting this story. Scientists speak, but will the politicians listen?

Scientists Back Plug-In Hybrids

WASHINGTON - A group of scientists urged Congress on Wednesday to fund research for plug-in hybrid vehicles, touting the technology as another way to reduce the nation's dependence on oil through the help of a simple electrical socket.

With high gas prices straining some Americans' budgets, advocates of the alternative vehicles told a House committee that plug-in hybrids could reduce gasoline consumption and reduce air emissions. And while ethanol-fueled vehicles will require a better network of fueling pumps, a plug-in hybrid car could recharge at home.

"To think that you could pull into your garage at the end of the day and 'fill 'er up' just by plugging your car into a regular, 110-volt socket in the garage is very appealing," said Rep. Judy Biggert R-Ill., chairwoman of the House Science subcommittee on energy.

Plug-in hybrids combine hybrid technology — which uses both gasoline and electric power — with large batteries that can be plugged into a standard wall socket. To help learn more about the vehicles, Rep. Lamar Smith, R-Texas, said he would introduce legislation to provide $250 million in grants to research battery technology and develop a fleet of demonstration plug-in vehicles that could be further tested.

The article continues, with comments from some critics here.

Bad News for Brazilian Ethanol

Thanks to fallout at The Oil Drum for bringing this story to my attention.

The entire article is worth a read. Here are some excerpts of note:

Brazil's Ethanol Lesson Is How to Manage Our Oil Addiction

The Brazilian government is declaring victory in its decades-long struggle to become self-sufficient in the supply of oil. The milestone is cause for celebration in a country that has long paid a high price for imported energy.

Brazil's success came not from treating oil as an addiction but by producing even more of the stuff and by becoming even more dependent on world markets.

Guided partly by Brazil's apparent success, American policy-makers are crafting new mandates for ethanol, and flex fuel vehicles are now taking shape. We have the impression that ethanol is king.

In reality, ethanol is a minor player in Brazilian energy supply. It accounts for less than one-tenth of all the country's energy liquids. The real source of Brazil's self-sufficiency is the country's extraordinary success in producing more oil.

Brazil's self-sufficiency offers three lessons for U.S. energy policy:

First is that ethanol, with current technology, will do little to sever our dependence on imported energy. Sugar plants in Brazil's climate are a lot more efficient at converting sunlight to biomass than is corn in the Midwest, but U.S. policy nonetheless favors corn (and imposes tariffs on imported sugar) because the program is really a scheme to deliver heartland votes rather than a commercially viable fuel.

Yet, even with Brazil's favorable climate and sugar's inviting biology, ethanol is already reaching the limit. That's because the land and other resources devoted to ethanol can be put to other uses such as growing food and cash crops.

Indeed, today the Brazilian government is actually reducing the share of ethanol that must be blended into gasoline because sugar growers prefer to make even more money by selling their product as sugar on the world market rather than fermenting it into alcohol.

Article continued at Brazil's Ethanol Lesson Is How to Manage Our Oil Addiction.

Oil Inventories Down, Gasoline Up

The government released petroleum inventory figures this morning. U.S. crude oil stockpiles fell by 100,000 barrels, and gasoline inventories rose by 1.3 million barrels. Refinery utilization was at 89.8 percent of operable capacity, the highest level since Hurricane Katrina struck. Gasoline imports averaged 1.45 million barrels per day, which was the 3rd highest weekly average on record. This is an indication that supply and demand remain in very tight balance, and the summer driving season is still in front of us. However, in the short term, with gasoline inventories starting to build, I would expect some easing of gasoline prices.


Source: This Week In Petroleum

The complete report can be accessed here.

On Deck

Next up is a response to Joseph Miglietta on ethanol. Following that, I will publish a short essay on Fischer-Tropsch (FT), which is a reaction that will become very important as oil supplies become more and more expensive. It will be a non-technical article, but I will provide links to more detailed technical explanations. The article will focus on both the promise, and the peril of FT in meeting a portion of our future energy needs.

Joseph Miglietta Response to Ethanol Debate Challenge

Introduction

Joseph Miglietta, a chemical engineer and chemist, responded to my Ethanol Debate Challenge. I look forward to the exchange of ideas. His response is posted below, with nothing changed except for some formatting. Joseph, if you need me to modify this post in any way, e-mail me. My e-mail address is listed in my profile.

I agree with some, but not all of what he writes. My response will be posted within a few days. As always, comments are still open to all. Feel free to add your own comments in favor of or against Joseph’s argument. Let’s just keep it civil, regardless of which side you take in the debate.

If anyone wishes to build a comprehensive argument as Joseph has done, either place it in the comments, or e-mail it to me. I will add the entry and then respond as needed.

Without further ado, here is Joseph’s post.

RR

----------------------------------------

Response by Joseph Miglietta

I would like to participate a little in this forum not so much for the challenge but for the opportunity of educating people who are concerned for the energy crisis and are badly hurt at the pump. Knowledge may avoid them to be misled by politicians and special interest groups. Especially here in the South where I now live, people’s knowledge on this subject is abysmal. So, if by means of these debates we can contribute a little to this effect, I would feel rewarded. My participation will be limited to debates conducted in a civilized manner (no insulting or taking it personally) and be characterized by objective criticism. I wish to add, I too am a chemical engineer and a chemist.

Conservation could be a solution to the oil crisis; it would also help traffic congestion, not to mention the lessening of environmental problems. But in my opinion, it is a step backward in our progress. Crises offer incentives for improvement; going back, instead, imply defeat. There is a natural conservation effect that takes place in times of crisis. People in this case tend to buy smaller and more efficient cars. In cities with large concentrations, such as New York or Chicago, public transportation is the best solution. But in spread cities as Los Angeles, suburbs and rural areas, our transportation relays on personal vehicles, not to mention for our leisure. It is our way of life. A drastic reduction in the use of personal vehicles would also affect our economy. A lot of people would be out of jobs. Overall, it would imply large sacrifices. In other words, the cure is worse than the disease.

During the first crisis of 1970’s, created by the oil cartel, there were long lines at the pump, particularly in California. I conceived then an idea to improve the fuel efficiency, but I did not have time to work on it. I was too busy trying to fill the vacuum created by the oil unavailability. I recovered spent or contaminated solvents and even made methyl acetate by a continuous process. The first crisis was of relatively short duration; it was the first showdown of the cartel countries against the Western World. Now the rule has changed: spiraling prices is the new rule, and the big oil companies have joined the game. From my student days, I was fascinated with oil for its many applications in many branches of industry, plastics, pharmaceuticals, solvents, etc., and considered a shame to burn it in fuels. But now I consider it even more shameful the fact that we depend on the oil found in rogue countries.

My interest in ethanol is only peripheral. Now that I am retired, I am working on developing my original idea: special additives that promote the shifting of the reaction equilibrium towards mechanical work at the expense of heat in engines using ethanol/gasoline blends.

Of course, producing ethanol from grain (corn) is not the best way. In general, producing ethanol from starch is by far less energy efficient than from sugars. If all the arable land in our country would be cultivated for corn for ethanol production, it would hardly make a significant dent in our fuel consumption. (I am exaggerating here a little to stress my point).

But I look at it in a different way. Farm lobbying is a powerful force that in this present crisis, with the mounting public rage, may counteract to some extent what I consider the most powerful force: the big oil companies. We have made some progress. A 10% incorporation of ethanol in gasoline, or E10, may sometime in the near future be nationwide. Sure, we can achieve this only by government subsidy, but it’s a start. Subsidies are supposed to be temporary measures. In the meantime, this will create an incentive to find more efficient ways to handle starch.

Research is being conducted to use cheaper starting materials. I found interesting the process under research called the Veridium bioreactor technology whereas a special strain of algae can produce a biomass containing 94% starch as opposed to 63% contained in corn, utilizing in the process the carbon dioxide given off by the ethanol-producing facilities. The interesting part is their claim: this biomass can be produced at a much faster rate than plants in less the surface area required for crops. In the present crisis, other alternatives are actively sought. Ethanol, however, offers the most practical approach.

The other alternatives, economically priced hybrid cars, hydrogen fuel cells, etc. are in the more distant future. All these, however, including the substitution of gasoline for ethanol take time. But we need a solution now, not years from now. We are pressed with time in view of the mounting competition for oil from China and India, its spiraling prices, global warming, not to mention that we are indirectly financing terrorism. For these very reasons, we need to import ethanol and reduce the import of oil.

One of the reasons I content is why we impose a tariff on a cleaner fuel imported from friendly countries and import tariff-free oil from rogue countries. The reason should be obvious: oil companies are the powerful force behind. Their tactics is simple: increase the price of gasoline at the pump, and then decrease it by a few cents to pacify the animosity of the public. But oil companies are not the only force against ethanol imports. The farmers are enjoying a windfall of profits. They too oppose competition. The way out, a little simplistic perhaps, is to keep these two forces at bay. As I said before, tax oil after a certain import level and give tax breaks on the amount of ethanol incorporated in the fuel.

As for the farmers, they are receiving a subsidy for the amount of corn used for ethanol. They should receive assurance that the amount of ethanol imported is only what they cannot produce—the more they produce the less we import. Once we develop other alternative crops cheaper than corn, they will need to switch. Grain ethanol is definitely not the most efficient process, except for moonshine. No other process is more energy efficient than sugar. Perhaps, we should grow sugar cane in Florida, Louisiana, some parts of Texas, and Hawaii. We cannot grow much but it may become a contributing factor. Another possibility is beet sugar.

We cannot compete with the cheap labor in Brazil, but better technology may give us a hedge. Still, we may not compete with the price of Brazilian ethanol, but it is better to contribute to sustain the labor force in a friendly country than sustain the finance of rogue states. Brazil has much less cars than us, and a vast territory with ideal climatic conditions for sugar cane. Consequently, they have a surplus of ethanol and they can easily meet an increased demand.

I know no other alternatives for ethanol; better perhaps, but not as commercially readily available as ethanol. Eventually, ethanol will be phased out but I don’t think this will happen for many years to come.

As for E85, my first reaction is: if we still cannot go national with E10, let alone E85. But that is not the question. E10 will not make us energy independent. But E85 would. E100 would be even better in this respect, but fuel efficiency is better with E85. I don’t consider a 15% gasoline consumption oil dependency. We can get this and more outside the oil cartel. The idea behind this is to create the necessary infrastructure for E85.

As I said before, we can import the necessary alcohol we still cannot produce. I use the word "alcohol" to include methanol, which could be produced from coal, and we have the world’s largest reserve of it. The technology has not yet been developed, however. The catalytic process from hydrogen and carbon monoxide may offer more economical possibility than that depending on natural gas hydrocarbons. Also, methanol is even less efficient than ethanol. But that is another matter of discussion, from which I prefer to stay out, since I would be biased. If I were involved in other energy projects that do not include alcohols, I would feel biased and stay completely out of this discussion.

Joseph Miglietta

Compressed Air Energy Storage

I have always been a big fan of wind power. But one of the knocks on wind is that it is intermittent. Since electrical demand probably won’t match up very well with wind fluctuations, installed wind capacity does not displace conventional power generation in a 1 to 1 ratio. For example, I have seen it claimed that 2,000 megawatts of installed wind energy still requires 1,800 megawatts of standby power for when the wind isn’t blowing. (1)

Clearly a storage system is needed. During times of high wind flow and low demand, the excess energy could be stored in something akin to a giant battery. When the wind isn’t blowing, users would pull from the "battery". I have given a lot of thought over the past couple of years as to just what form such a storage system would take. I could envision several different options. One, air could be compressed into a storage system and then discharged through a turbine as needed. Two, water could be pumped uphill, and then be allowed to flow back through a turbine as needed. Three, water could be split to hydrogen and oxygen. I don’t like this option as much, because most electrolysis is inefficient and hydrogen storage is problematic.

(Incidentally, a variation of this third option was recently brought to my attention, in which excess wind power is used to make methanol, ethanol, or even ammonium nitrate fertilizer. For an excellent comprehensive overview of this option, combined with an impressive overview of wind energy potential in the Great Lakes area, see David Bradley’s report A Great Potential: The Great Lakes as a Regional Renewable Energy Source.)

Imagine my surprise this weekend to learn that while I have been daydreaming about a wind energy storage system, someone is in the process of doing it. Furthermore, others have previously blogged on it. I felt a bit like Rip van Winkle after waking up from his long nap. How could I have missed such an important development? The storage system is called compressed air energy storage (CAES). A January article from MSNBC explains the concept in Store wind power for later use? Cities bet on it:

A group of Iowa cities intends to not only harness the wind, but also capture it, store it underground and use it to help make electricity when demand peaks.

Members of the Iowa Association of Municipal Utilities have invested in a proposed power plant that would use wind turbines to drive compressed air into underground aquifers. The air would be released to generate electricity when needed.

The plant will use power from its own wind turbines, supplemented by cheaper electricity bought at off-peak times, to force air into rock formations at least 2,000 feet underground.

Current plans call for pressurized storage of tens of billions of cubic feet of air in rock formations deep underground. (2)

If you think I was surprised by that, imagine my surprise upon reading this from the same article:

Only two other underground compressed air plants are in operation. A plant in Huntorf, Germany, was built more than 23 years ago and a plant in McIntosh, Ala., is 11 years old. Both store compressed air in underground salt caverns.

Iowa's project is unique in that it would use wind power to store the air and combine it with massive underground storage capacity.

The Germany and Alabama plants store hundreds of thousands of cubic feet of air in a thermos-bottle shaped container installed in the salt mines. The Iowa project would use naturally occurring pockets embedded in sand or sandstone formations sealed by shale or other rock.

So, a plant in Alabama has been using compressed air storage successfully for 11 years, and I didn’t know about it until this weekend. The only difference is that they aren’t using wind to do it. The Iowa plant will be the first to do that, but others will probably follow.

To be sure, such a storage system is not universally applicable. You need some kind of large, airtight, underground cavern. There are a lot of these in the United States, but they need to be located near a source of wind. Although, now that I think about it, I see no reason such a system couldn’t also be paired with solar or tidal generation systems, storing their excess energy using the same concept.

The plant is scheduled to come online in 2010. I wish them great success, and look forward to hearing reports after they start up.

References

1. "Airtricity’s rise and rise leaves criticism blowing in the wind", Irish Examiner, April 30, 2005.

2. "Store wind power for later use? Cities bet on it", MSNBC.com, January 4, 2006.

Ethanol Debate Challenge

Suggested Debate Guidelines

My opinions on grain ethanol are clear from my previous essays. I object to grain ethanol because I feel it is a tremendous misallocation of time, money, and resources, while the benefits are marginal (and may even be harmful). I believe there are far better uses for our alternative energy dollar, and grain ethanol in the long run is a dead end (unless you use coal to make it, but there are probably better uses for coal). But it seems that I have some critics (see next section). So, I want to give them a chance to have their claims examined in a public forum.

I offer the following debate challenge to any ethanol advocate willing to take it on. We will have a written debate, to be hosted on this blog, and anywhere you would like to host it (provided it isn’t edited). I would propose 3 rounds, with a 1500 word maximum per round. Up to 1 week would be allowed between postings. I do not care anything about your credentials, but claims must be verifiable, and claims from the peer-reviewed scientific literature are preferred. Claims from obscure papers or anecdotal evidence will not be allowed.

I can think of several possible debate topics. My opponent may feel free to suggest their own, or to propose modifications in the guidelines I set forth in the previous paragraph. My suggestions for debate topics are:

1. The pros/cons of producing ethanol from grain.
2. Whether Brazil provides a useful example for U.S. energy policy.
3. The pros/cons of E85 as fuel.

I foresee the debate getting into energy balance issues, use of energy inputs into the ethanol process, the USDA studies on ethanol, ethanol subsidies, and alternatives to ethanol. If you are an advocate, and wish to test your mettle, let me know. There has been a lot of pro-ethanol press lately. I maintain that it is based largely on misinformation and exaggerations, and that these claims will break down upon investigation. So, Tom Daschle, Vinod Khosla, or Dan Rather, let’s see what those arguments look like when they are subject to cross-examination. Who knows? You might even convince me. I really do have an open mind. My objective is not to "beat you" in a debate. It is to educate people on both sides of this issue. If you are interested, leave a note in the comments after this post.

Addressing Some Critics

Rarely do I encounter an ethanol advocate who backs up their arguments with actual literature references. Most of them seem to fall into one of 3 (not necessarily mutually exclusive) categories: 1). The naïve idealist; 2). The ethanol investor; or 3). The person whose livelihood depends on ethanol. Their style of argumentation frequently consists of ad hominems, bombast, rhetoric, and made up facts. Their arguments are conspicuously light on references and verifiable facts. See my account of a previous exchange on another blog.

This time, I will highlight a recent exchange I had with an advocate over at The Oil Drum. Not unexpectedly, he refused my request to debate the issue. I think he had a problem with "claims must be verifiable", as he made a lot of claims that did not withstand scrutiny.

I have endured the occasional potshots by an advocate who simply states "False", or "You don’t know what you are talking about" in response to one of my arguments. This one started much the same way. The trouble started when a poster linked to this 2004 paper by David Blume. (1) Blume is an ethanol proponent, and author of the book "Alcohol Can Be a Gas". After reading through his essay I concluded that some of his arguments simply were not credible. I gave my reasoning in this thread. I won’t get into all of the issues I had with Blume’s essay, as several are covered in the thread above. Below is a sampling:

David Blume: Let's talk about the subsidies things first. Pretty much – if you take a look at oil, some of the timid evaluations of how much oil is subsidized show it to be subsidized at the rate of about $5 per gallon. The more complete analysis of subsidies for oil show it to be subsidized at about $15 per gallon.

Clearly, he is suggesting that the "real" subsidy for oil is $15/gallon. A $15 per gallon subsidy? So, a barrel of oil is subsidized at the rate of $630? We use about 3 billion barrels of oil in this country a year. So, he is suggesting that oil is subsidized at the rate of almost $2 trillion a year. This is approximately the size of the entire U.S. budget. (2) As far as I am concerned, his credibility is shot right there. The theme throughout is that he played pretty loose with the facts, exaggerating for effect as needed.

He commited the expected ad hom on David Pimentel (basically accusing him of fraud), and then makes the positively ludicrous claim that the energy return from corn is actually 2.94:1. Not even the USDA makes that claim, and they are counting the by-products as BTU outputs. This is another serious shot to his credibility.

In another essay, Blume is discussing ethanol production from sugar beets. (3) He says:

David Blume: There has been research that shows a 1:11 energy-balance ratio with ethanol. The USDA, definitely a conservative entity, found net positive output from ethanol of the order of 67 percent. When you compare that to the current numbers on petroleum extraction, which hover around the 1:1 ratio, we should wonder why we all aren't growing sugar beets."

I have certainly never seen anything like an 1:11 (I presume he is saying energy inputs:energy outputs) energy balance for sugar beets, so I am skeptical. I asked for a reference. But I do know a bit about the other 2 claims. The USDA is definitely NOT a conservative entity, but what Blume is implying here by suggesting that is that the energy return is even better than they say. The USDA is definitely pro-ethanol. But, I have shown that their positive energy return of 67 percent doesn’t withstand scrutiny. Interesting to note that Michael Wang, one of the co-authors of that report, doesn’t even use that number when giving presentations on ethanol. In a presentation he made just last fall, he said that to produce 1 MMBTU of ethanol requires a fossil fuel input of 0.74 MMBTU. That is an energy return of 1.35.

But, the most ludicrous claim of all is that the current numbers on petroleum extraction hover around 1:1. To Blume’s credit, he is only off by an order of magnitude. The real numbers on petroleum extraction are at least 10:1 for both the extraction step and the refining step, for an overall return of at least 5:1.

Blume also stated, in the same article dated June 8, 2005:

David Blume: "The choice is over; we hit peak oil production in November 2004. We're currently operating in a functional oil peak, and alcohol is the only fuel to challenge gas."

Of course that’s not true, is it? We didn’t hit peak in November 2004. You can see the government statistics here . (4) So there is another unwarranted claim. In summary, I didn’t feel like the guy had demonstrated a great deal of credibility on several items, so I indicated that I would be cautious accepting claims without pretty good references.

So, how did my opponent respond over at The Oil Drum? You can see some of the exchange with "fuelaholic" starting here. Blume himself responds with a series of Red Herrings, which for the most part I just ignored, instead challenging him to debate the issue. But it didn’t take long for my opponent to get nasty:

Fuelaholic: I think the Oil Drum folks need to research who you really are and who your allegiance is really to. Your paycheck, perhaps?

Isn’t it ironic that an anonymous poster would say that I need to be investigated to find out who I really am? If I had some ulterior motives, would I be more likely to adopt a pseudonym, or use my real name?

Fuelaholic: Like Pimentel, who refused to apply his numbers to organic farming methods, you focus on what is, not what can be.

Incidentally, fuelaholic frequently calls Pimentel an "oil company shill". Speaking of which:

Fuelaholic: First of all, I've read plenty of biofuels comments here. They are not as clearly slanted, and poorly thought out as yours. And I haven't agreed with a lot of them. But I know they aren't oil company shills.

I guess if you can’t support your arguments with facts, insult your opponent or cast aspersions on their motives.

Fuelaholic: I repeat, you are the one with the made up facts, poor understanding of basics (energy input vs energy output) and you are simply parroting oil company complaints and then covering your butt to disguise it whenever you can.

This from someone who hasn’t once addressed any of my arguments. I invite the reader to check that out by reading the link at The Oil Drum.

Fuelaholic: You're an insulting smug wannabe know it all.

Sticks and stones…. Again, the reader can see who is doing the insulting. Also, my work with ethanol is in the public record, and can be easily verified. There are a couple of links to the right you can use to see for yourself. I will also point out that some of the posters at The Oil Drum disagreed with his assessment after I posted the exchange there.

Fuelaholic: I think frankly instead of saying something like, this beet EROEI is bs, you should be saying, oh, really, I'd like to see that study. But you didn't.

The funny was that I had asked him for the reference. My exact words were "Show me the reference". You can see at the link above. This is the kind of sloppy argumentation that I find very annoying.

Fuelaholic: It's clear you have no children, no concern for hope, no concern for anything other than your paycheck.

Wrong on all counts. These are the same sorts of "facts" he has used to support his ethanol arguments.

Fuelaholic: And you spend too much g-d time blogging. You have to be paid for it! End of story.

That’s it. "End of story". Another "fact" from fuelaholic. Sadly, the advocates often can’t tell the difference between making a claim, and making a factual claim.

Nice guy, eh? His mistake is in taking this personally. He should be interested in getting to the truth of the matter. If someone can show me a viable method of significantly improving the energy balance for ethanol, I am not going to call you names and throw out a bunch of Red Herrings. I would be perfectly happy to embrace ethanol if I thought it made sense to do it. Right now, I think many other options are far better.

References

1. Blume, David, "Alternative Fuels – Promise and Perils", 2004 Conference Proceedings of The Community Solution, 2004.

2. "United States Federal Budget", Wikipedia 2006.

3. "Ethanol Dreams", Metro Santa Cruz, June 8, 2005.

4. "World Oil Supply, 1997-Present", Energy Information Administration. Accessed May 11, 2006.

Daschle and Khosla Ethanol Propaganda

I just read an Op-Ed piece in The New York Times by Tom Daschle and Vinod Khosla. The editorial is Miles Per Cob, (1) and is one of the dumbest things I have run across in a long, long time. I can’t actually believe such garbage makes it into print, and I have to wonder whether it will actually convince anyone.

Let’s break it down.

Our addiction to oil underlies the greatest threats to our country's stability and prosperity: we pump billions of dollars into fundamentalist "petrolist" regimes in the Middle East and release into the atmosphere carbon from petroleum products, perpetuating global warming and aggravating natural disasters from the Gulf Coast to the Indian Ocean.

OK, I am with you so far. Billions of dollars sent to the Middle East, and perpetuation of global warming. I have no problems with this argument.

The answer to these threats is research and innovation to commercialize new fuel technologies in partnership with America's farmers. Our national leadership must promote a market-based shift away from petroleum-based fuels toward renewable fuels produced in America with American technology.

Partially agree. We do need to transition toward renewable fuels. But since none of the alternatives can replace our current fuel demands, and none are completely renewable - they all have fossil fuel inputs - we also need to encourage conservation in a BIG way.

The CAFE standard does nothing to encourage that change. It requires American automakers to build cars and trucks that meet a minimum standard of average mileage traveled per gallon of gasoline. But the current standard for minimum mileage traveled per gallon of gas consumed is both too low and focused on the wrong challenge.

Say what? I thought they said they were worried about global warming. So, here’s a pop quiz, Mr. Daschle and Mr. Khosla: Which option contributes the least toward global warming? A). Conservation; or B). Fueling up with ethanol. If you answered "B", then you failed today’s quiz. You see, all of the alternatives out there, including the best of the bunch, have fossil fuel inputs. Ethanol, especially grain ethanol, has more fossil fuel inputs than any other alternative. By favoring any alternative over conservation, you show that you are not sincere about the global warming angle. You are promoting propaganda, plain and simple, to further an agenda.

We need to upgrade to a new CAFE: Carbon Alternative Fuel Equivalent. This new CAFE will measure "petroleum mileage" and give automakers incentives and credits for increasing ethanol consumption as a percentage of fuel use of their vehicles, not least by promoting flex-fuel vehicles, which can run on either gasoline or E85 fuel, a blend of 85 percent ethanol and 15 percent gasoline. This approach promises several significant benefits.

Given that Khosla has a lot of money invested into ethanol, the motives toward his push for ethanol are suspect. There is nothing, and I mean nothing, that can make a bigger impact toward reducing our dependence on foreign oil and reducing our greenhouse gas emissions than conservation. Perhaps Mr. Daschle and Mr. Khosla saw the special last night on 60 Minutes, in which ethanol proponent and Berkeley professor Daniel Kammen stated that the greenhouse gas reduction from using ethanol would be "modest". Interesting choice of words there. Do you know why he said "modest", instead of something like "substantial", or "significant"? Well, it’s quite simple. The reason he said "modest" is that ethanol production consumes a lot of natural gas, resulting in the emission of a lot of greenhouse gases. The byproducts of the process are then fed to cattle, which produce methane, a very potent greenhouse gas.

So, in promoting ethanol you are merely playing a shell game, in which the greenhouse gas emissions are not substantially reduced, but the source of the emissions has been shifted from gasoline to natural gas. Among other things, this will drive up heating costs in the winter, because competition for natural gas will increase as more ethanol is produced. (An alternative, of course, is to use coal to fuel the ethanol plants, but you say you are concerned about global warming. In that case, coal is out).

First, it could set America free from its dependence on foreign oil. As Brazil's "energy independence miracle" proves, an aggressive strategy of investing in petroleum substitutes like ethanol can end dependence on imported oil.

This kind of nonsense needs to be confronted. Let’s see your calculations, Mr. Daschle and Mr. Khosla. I can show you mine, that demonstrate that if we turned 100% of the corn crop into ethanol, we would displace less than 15% of our annual motor fuel demand. On a "net" basis, though, the displacement is much less because we will have consumed enormous quantities of natural gas in producing the ethanol. Greenhouse gases will increase, but Mr. Khosla will have made a lot of money in the process.

Second thing, I pointed out in my previous essay that there is much more to Brazil's "energy independence miracle" than "an aggressive strategy of investing in petroleum substitutes". Brazil can do it because: 1). Producing ethanol from sugarcane is much more efficient, and much less energy intensive; 2). Brazilians use 1/6th of the energy per person that we use here in the U.S., meaning their fuel demand is much lower; 3). Brazilians drive tiny, fuel efficient vehicles; and 4). Gasoline prices in Brazil are even higher than they are in the U.S. (even though gasoline there has less energy content due to the ethanol). So do not pretend that Brazil’s "miracle" is in any way applicable to the U.S., unless you are also willing to implement 1-4 above.

Second, switching from gasoline to ethanol produced from perennial energy crops like switch grass can slash our carbon dioxide emissions.

I agree that producing ethanol from energy crops would probably be an improvement over ethanol from corn. So, why don’t you build a cellulose ethanol plant and demonstrate that instead of encouraging more corn ethanol production? Why is your editorial entitled "Miles Per Cob"?

The rest is mostly "Mom and apple pie", so I won't comment on it. Instead of appearing as an editorial, Mr. Daschle and Mr. Khosla should have been forced to pay to have this inserted as an advertisement. I felt dumber for having read it. The cynical side of me really struggles to understand their motives. Are they sincere, but just that misinformed? Do they honestly believe that this is the best solution for our energy woes? Or are they just out to make a buck, and so they don’t care that much about adopting solutions that make more sense (but won’t put money in their pockets)? I just don’t know. But I do know that misleading pieces like this will lull the public into complacency about our energy crisis. Writing things like "ethanol can end dependence on imported oil" is an incredibly irresponsible (and false) claim, given that it took a lot more than that to do it in Brazil.

Reference

1. "Miles Per Cob", The New York Times, May 8, 2006.

60 Minutes - The Ethanol Solution

I just finished watching the 60 Minutes piece on ethanol production. Wow. What a puff piece. I thought at least I might see some attempt at balance. But there was no mention of the disadvantages at all. It makes you wonder why ethanol is the least bit controversial. Let’s break the piece down a bit.

Dan Rather on Brazil

Rather pointed out that Brazil has virtually stopped importing foreign oil by switching to ethanol. He said ethanol is cheaper and cleaner. He had Berkeley professor Daniel Kammen on, who said that Brazil made a commitment to ethanol, and then followed through.

So, if Brazil can do it, why not us? Right? Or was Brazil able to do it for reasons other than making a serious commitment?

First, Brazil uses sugarcane to produce ethanol. It is hands down the best crop for making ethanol. The ethanol yield per acre is twice that of corn ethanol, and the energy requirements for refining the crude ethanol are far lower. Unfortunately, the climate in most of the U.S. is not amenable to sugarcane production.

Second, they showed a brief shot of Brazil’s highways. You know what I saw? No Hummers. No SUVs. No pickups. No large vehicles of any kind. That's one reason the average annual per capita energy consumption in Brazil is 36.3 million BTUs/person. On the other hand, the average in the U.S. is 209.7 million BTUs/person - almost 6 times as much! Are you starting to get a picture of why Brazil can do it?

Finally, I couldn’t help but notice the absolute irony of one clip showing workers in Brazil out in the field hacking down sugarcane by hand. Then, they showed a clip in the U.S. where they were harvesting corn by tractor. One requires fossil fuel energy inputs. One requires cheap manual labor.

Dan Rather Back in the U.S.

Dan said that 10% ethanol won’t replace much foreign oil, "unless Americans switch to E85". If Rather had bothered to do a bit more research, he would have found that even if we turned the entire corn crop into ethanol, it would provide less than 15% of the annual motor fuel demand. At the same time, due to the huge inputs of natural gas required to produce ethanol, we would consume enormous quantities of natural gas, driving the price higher, and in turn driving the ethanol price higher.

Rather toured an ethanol refinery. They discussed the distillation step. Where does Rather think the energy for the distillation comes from? Does he think they are creating enough energy to drive the distillation? Frankly, I would love to see someone run an ethanol refinery in this manner - drive the distillation by the energy that was produced. The charade would come to a screeching halt when they discovered that they couldn’t supply the energy needs of the refinery with the energy they produce.

Rather interviewed some corn farmers, who stated "we have raised the price of corn $0.05-$0.10/bushel". That’s great for the corn farmer, but let’s point out that this also raises the price of everything in the food chain that is based on corn.

Rather asked Professor Kammen "Is ethanol the best way to reduce our importation of oil?" Let me take that one, Dan. No. Conservation is the best, and quickest way to reduce our importation of oil. Hands down. No controversy.

Professor Kammen admitted that the greenhouse gas reduction would be "modest". Why do you suppose a "green" fuel would only have a "modest" greenhouse gas reduction? Because of the large quantities of fossil fuel inputs required to make the ethanol.

Rather mentioned on a couple of occasions the "multi-billion dollar profits" that oil companies are making. How much does he think ADM has profited, as a result of a government-created and heavily subsidized industry?

Dan Talks Disadvantages

Actually, he didn’t. So, I will. Here’s just a few things that Rather neglected to mention. E85 will significantly reduce your gas mileage: Gas Mileage of Flexible-Fueled Vehicles. Government-run tests documented at this site show the reduction in mileage for various flex-fuel vehicles. A Ford Taurus, for instance, is reported to get 29 mpg on the highway running on gasoline, and 21 mpg running on E85.

The amount of energy created per gallon of ethanol produced is very small, yet ethanol is subsidized on a per gallon basis. This means to displace a single gallon of gasoline requires anywhere from $4.00 to over $7.00 in subsidies, depending on whether you include the corn subsidies.

The cost of ethanol in the U.S. is consistently and substantially higher than the cost for gasoline. The only reason you don’t see this reflected at the pumps is because of the subsidy. But you can see a history of ethanol price versus mid-grade gasoline prices here. Friday’s closing prices on the market, for instance, were $2.77 for ethanol and $2.04 for mid-grade gasoline. Given that ethanol contains less than 70% of the BTUs that gasoline contains, the price per BTU is even more disadvantageous for ethanol.

Rather kept mentioning how clean ethanol is. First, ethanol raises the vapor pressure of gasoline, which increases smog. That’s why ethanol blended reformulated gasoline has to have a vapor pressure waiver. Second, corn farming is certainly not clean. Consider a recent report by Lester Lave and Michael Griffin, from Carnegie Mellon University. They write :

Corn farming is rough on the environment. Soil erosion due to wind and water is rampant. Fertilizer and pesticide runoffs produce algae blooms that result in "dead zones," including one in the Gulf of Mexico that is so polluted it cannot support aquatic life.

In summary, I would hardly call this puff piece journalism. It looks like something the ethanol lobby put together. It does a disservice to the American public by lulling them into thinking this is a potential solution to our energy problem. Without a substantial effort at conservation, it is folly to suggest that grain-derived ethanol offers anything other than false hope.

Coming Attractions

Just wanted to provide a quick update, since it will be a few more days before I have a new essay up. I am trying to finish up an article on Peak Oil for Omninerd, and need to devote a couple of days toward working on that. I recently finished my first submission for The Oil Drum entitled Big Oil and Alternative Energy . Feel free to comment on it at The Oil Drum, or if you aren’t registered there you can comment on it in this thread. The article addresses the statements from various groups that oil companies should invest their record profits into alternative energy. I explain why this is wishful thinking.

Below is a list of subjects that I will be covering in upcoming essays (not necessarily in this order), along with a brief description. If you have a topic you would like to see addressed, let me know.

The Solar Economy - I have only mentioned solar energy on my blog in passing, but it is far and away my favorite alternative energy choice. There is nothing else that compares to the efficiency of direct solar capture. I can envision a society that is driven largely off of solar power, but electrical applications and many automotive applications would need to be operated via rechargeable batteries.

The Diesel Economy - Even if we had no oil at all left, we can produce diesel from coal, natural gas, or even biomass. The capital costs are pretty high, but the feasibility exists (and in fact, is already taking place).

Fischer-Tropsch - I plan to give a brief, layman’s overview of this very important reaction, which will enable The Diesel Economy. This is also how the Germans produced some of their liquid fuel in WW2.

GTL - Gas to liquids, or diesel production from natural gas. This option is currently well under way in Qatar.

CTL - Coal to liquids. This is Montana Governor Brian Schweitzer’s dream for Montana coal. While it is viable, capital costs will be high, and the environmental costs may be steep. I will have a detailed discussion of the issues.

BTL - Biomass to liquids. This one is the least developed, but has the most potential for producing diesel from a renewable resource. I will discuss potential hurdles to be addressed.

I am open to suggestions on other topics. As always, I will continue to comment on current events, so I expect this list of ideas to take me through the next month or so. But I am always open to suggestions.

Debunking the Debunkers

There are a few things I have learned over the years regarding the relationship between the public and oil companies. The public seems to have an especially strong distaste for oil companies, and especially Big Oil. They don’t seem to care that the profit margins are much higher at Microsoft or Citibank, because they don’t have to shell out money directly to them on a regular basis. If they are paying higher prices than they think they should be, and oil company earnings are good, then they think they must be getting ripped off.

This mentality is pervasive, despite the fact that finding, extracting, and refining oil is risky, both physically and financially, and requires huge sums of capital. When is the last time someone was seriously injured programming software? Does it require a multibillion dollar capital investment to sign someone up for a credit card at 18% interest? But, I bet if you polled the public, a substantial portion would say they don’t care if oil companies make any money at all. They just want their cheap gas. Of course politicians know this and they pander to their constituents, promising to punish oil companies and to bring prices back down.

Oil Industry "Windfall"
Source: Facts on Fuel

To be fair, not everyone is complaining. From CNNMoney.com:

First the oil companies scour the freaking globe, going to the most gosh-forsaken dangerous places on earth to find the stuff. Then they pump it. Then they ship the stuff in huge, complicated ships halfway across the world. Then in giant, expensive plants they refine the stuff through amazingly complicated processes and turn in into gasoline. Then they distribute it to rural Nebraska and Vermont and all over the USA. The price is less than a gallon of bottled water, and it's gone up less than inflation, and we take it for granted and we've squandered it with our Suburbans and Tahoes and Navigators. (1)

That brings me to a new report from Consumers Union , a non-profit publisher of Consumer Reports, explaining how you are being ripped off by oil companies. The report is "Debunking Oil Company Myths and Deception: The $100 Billion Consumer Rip-Off" (2). The report gets into some areas not addressed in an earlier attack piece by FTCR, which I previously addressed. Therefore, it is worth a bit of time to address the allegations made by Consumers Union. I will hit the highlights, most of which are contained in a news release here.

Addressing Some Claims

Claim 1: The U.S. oil industry made $100 billion in windfall profits since the late 1990s, largely by eliminating refining capacity that paved the way to drive up prices at the pump.

Fact: The oil industry is cyclical, and is not always as profitable as it is now. So, what is the baseline for defining a windfall profit? Should it be based on a time in which the industry was at the bottom of the cycle? Refineries are shut down when they are not profitable - not to restrict capacity. If there is a refinery that is not providing a very good return, or is even a money loser, why should I be expected to continue running it? Would you run your business this way?

Consider this "windfall" analogy. Millions of homeowners are sitting on a huge amount of appreciation in their homes. What did they do to earn this windfall? Nothing, other than being in the right place when the market was appreciating. I am sure the person buying one of these houses doesn’t want to pay that much for it. But, what are their options? All of the other houses are also sitting on windfalls and are also "too much". Consider the person in California who bought a house for $170,000 that is now worth $750,000. That is a serious windfall. Shall we cap how much they can sell their house for? After all, that price isn’t really "fair" to new homeowners. Shall we impose a steep windfall profits tax for all houses that have a certain level of capital gains, and then use that to help those who want to move into that neighborhood? Sure, they will have to pay capital gains taxes, just like oil companies pay taxes on their earnings. But why not an additional penalty, since they really did nothing to earn their windfall? The market just gave it to them.

Claim 2: Consumers are trapped between a small group of powerful, non-competing oil companies out to maximize profits and weak governmental authorities who consistently fail to strengthen or enforce the law.

Fact: The oil companies are certainly out to maximize profits. That’s what companies are supposed to do. But non-competing? How’s that? ExxonMobil, the largest company in the United States, controls 3% of the world’s oil supply and 8% of the nation’s service stations. How exactly is it that oil companies aren’t competing? No company can dictate price, because they don’t control enough of the market to do so. Oil companies have been investigated countless times for collusion, and they have always been vindicated. In order to be "non-competing", a company either has to control the market or be in collusion. Unless Consumers Union can show either of these to be the case, they should retract this claim.

Claim 3: On Wall Street they point to their soaring return on equity and cash flow as proof of their huge profitability, while on Main Street they point to profit as a percentage of sales and ignore cash flow to claim less than stellar results.

Fact: The reason oil companies point to their profit on sales is that it is a commonly reported metric for many different industries. It allows the public to see just where Big Oil fits among other industries. The return on capital employed (ROCE) metric is often criticized as proof that the profitability of Big Oil is "too high". What ROCE means is basically the return on your assets. That is a perfectly acceptable measure of a company’s profitability, but if you want to criticize it for being too high, you must again look at other industries. What is the ROCE for software companies? Banks? Pharmaceuticals? Since these industries don’t require a lot of capital, as is the case with oil companies, their ROCE is going to be much, much higher than that for oil companies. What ROCE does is allow one oil company to compare itself to another. Using ROCE to claim that oil companies are too profitable is meaningless unless we use the same metric to compare other industries and see where Big Oil fits into the overall picture.

Irony

I thought one theme in the report was particularly ironic. On the one hand, they admit that earnings were much lower just a few years ago. ExxonMobil, for instance, had profits of $11 billion in 2002, which was less than 6% profit on sales. Yet they complain the oil companies have underinvested in recent years in new refining capacity. So, let me pose a question for the good people at Consumers Union: Do you think it’s possible that underinvestment was due to lower profits just a few years ago? Profits drive investments. When you are making good profits, you tend to make more investments back into the business. When profits aren’t all that great, you don’t have as much money to invest in the business. Yet the supreme irony is that when profits are good, so more investments can be made back into the business, you complain about the windfall!

What are companies doing now that earnings are good? ConocoPhillips invested 141% of their first quarter earnings back into the business. ExxonMobil invested more than 50% of their earnings back into the business. Chevron's earnings were $4 billion, and their exploration and production budget for the first quarter was $3 billion. This can be done when earnings are good. The reason this level of investment did not occur 5 years ago is that the earnings were insufficient to support that level of investment.

References

1. "Defending Big Oil and buying some stock", CNNMoney.com, April 27, 2006
2. "Debunking Oil Company Myths and Deception: The $100 Billion Consumer Rip-Off", Consumers Union , May 3, 2006.

Bio-Butanol

Butanol Production Process

In my previous job, I worked for a major chemical company for seven years. For six of those years, I worked on various processes to produce butanol. This included roles in R&D, process, and production, and I received a patent while working in Germany for devising a novel process for making butanol. Butanol is an alcohol like ethanol, but whereas ethanol has 2 carbon atoms, butanol has 4.

The most common industrial process to produce butanol involves a few steps. First, synthesis gas is produced. Synthesis gas is a very important raw material. It is composed of hydrogen and carbon monoxide, and is produced by burning a feed at a high temperature while limiting the oxygen available for the reaction. The feed material for producing synthesis gas can be natural gas, fuel oil, coal, or even biomass. Once synthesis gas is produced, it can be used to make a wide variety of chemicals, including diesel (via the Fischer-Tropsch reaction), methanol, ethanol, propanol, or butanol.

If the desired end product is butanol, the synthesis gas is reacted under pressure with propylene to first produce butyraldehyde, and then this is reacted with hydrogen under pressure to produce butanol. The crude product contains butanol, isobutanol, and water, and must be distilled to obtain specification butanol, which has a wide variety of end uses.

The energy return on investment (EROI) for producing butanol in this way is certainly less than 1. I have never bothered to calculate it, but there are a number of energy intensive steps involved in butanol production. However, given the end uses for butanol, the EROI was never a major concern. Sure, saving energy during the production of butanol was always a priority, but since it typically is not used as a fuel, there was no requirement that the EROI be greater than 1 in order to have a viable process.

Bio-Butanol versus Bio-Ethanol

I have made clear in several of my essays on ethanol that my primary objection to using ethanol as fuel is the poor EROI. Ethanol production consumes large quantities of natural gas via fertilizer for corn and then distillation of the ethanol. (If coal is used instead of natural gas, you may have an economic process, but certainly not a green one). The reason so much distillation energy is required is that ethanol is completely soluble in water. The end product of the fermentation results in something like an 8% ethanol/92% water solution. It takes a lot of energy to heat water up, so the distillation of ethanol into a pure form uses up a lot of energy and contributes to the poor EROI.

Butanol, on the other hand, has a more limited solubility in water. According to the Material Safety Data Sheet (MSDS) for butanol, it is only 7.7% soluble in water. What does this mean? There is a much less energy intensive method of separating butanol from water, and that is by letting it phase out (just like oil and water). Therefore, you would expect the EROI for producing butanol from corn would be much better than for producing ethanol from corn.

Until this weekend, I didn’t realize that anyone was producing butanol from corn or biomass. During my graduate school studies, we produced butyric acid as a very smelly byproduct of our biomass process, and this can be converted into butanol. But one of the editors over at Omninerd pointed me to a site this weekend that demonstrates the viability of producing butanol from biomass. I encourage you to check out the claims at http://www.butanol.com, which are based on the work of a chemical engineering professor at Ohio State.

The entire site is worth a read. Here are a few excerpts:

How does butanol compare with ethanol as an alternative fuel?

Butanol has many superior properties as an alternative fuel when compared to ethanol. These include:

· Higher energy content (110,000 Btu’s per gallon for butanol vs. 84,000 Btu per gallon for ethanol). Gasoline contains about 115,000 Btu’s per gallon.

· Butanol is six times less "evaporative" than ethanol and 13.5 times less evaporative than gasoline, making it safer to use as an oxygenate in Arizona, California and other states, thereby eliminating the need for very special blends during the summer and winter months.

· Butanol can be shipped through existing fuel pipelines where ethanol must be transported via rail, barge or truck

· Butanol can be used as a replacement for gasoline gallon for gallon e.g. 100%, or any other percentage. Ethanol can only be used as an additive to gasoline up to about 85% and then only after significant modifications to the engine. Worldwide 10% ethanol blends predominate.

They claim the process is competitive with ethanol on a per gallon basis. Given that butanol has substantially more BTUs than ethanol, the price per BTU would be much lower than for ethanol:

Our preliminary cost estimates suggest that we can produce butanol from corn for about $1.20 per gallon, not including a credit for the hydrogen produced. This compares with ethanol production costs of about $1.28 per gallon. Taking into account the higher Btu content of butanol, this translates to 105,000 Btu per dollar for butanol and 84,000 Btu per dollar for ethanol with corn at $2.50 per bushel. As a further point of reference, butanol produced from petroleum costs about $1.35 per gallon to manufacture.

The economics of the EEI process will be even more attractive when waste material is used as feedstock instead of corn and the price to produce a gallon is $0.85. In such cases the need and cost to grow and prepare the corn for fermentation, by far among the major cost items, are eliminated.

A couple of other claims are worth noting. They say that they can produce 2.5 gallons of butanol for every bushel of corn. On a BTU basis, that is 30% more BTUs than can be produced if ethanol is the end product. Second, they also claim that butanol can be used in biodiesel applications, and can be blended with diesel. If true, that would give butanol a significant advantage over many other alternative fuel options. Finally, they note that the process produces a significant amount of hydrogen as a byproduct.

What’s the Catch?

I need to spend some time going over the patents and linked reports more closely to see if anything suggests a problem that has been glossed over. I can think of one possible issue off the top of my head. One of the knocks on methanol is the toxicity. Ethanol is considered non-toxic for the most part. If trace quantities of ethanol entered the groundwater, it would not be as alarming as methanol getting into our water supplies. Butanol is less toxic than methanol, but more toxic than ethanol, and it is somewhat soluble in water. Therefore, the one thing that should be addressed is the potential for butanol to find its way into our water supplies.

Other than that, this looks worth pursuing. Butanol has a number of clear-cut advantages over ethanol, and it should have a superior EROI. The authors of the site indicate that they need to complete testing on a demonstration plant and a pilot plant. I look forward to the results of their testing.