Domestic Fuel

When discussing indirect land use it brings a popular saying to mind: If a tree falls in the forest and no one is around to hear it, does it still make a sound? Only in this situation the saying should be modified as follows: If a tree is cut down in a rainforest in Brazil to sell wood, should corn ethanol’s carbon footprint go up? Anyone with an ounce of commonsense would say no.

And here’s why: when a tree is cut down in Brazil, it is not to plant crops for biofuels, it is to sell the wood because the tree is of greater value as wood, then as part of the rainforest. Only then is the land converted to pasture and then to land for crops like soybeans. Sugarcane is rarely grown in the rainforest and Brazil doesn’t produce biofuels from corn. So what I just can’t seem to wrap my head around is what exactly does that tree have to do with corn ethanol?

So what has caused today’s diatribe on indirect land use? A new paper published this month in Bioscience Magazine titled, “Effects of US Maize Ethanol on Global Land Use and Greenhouse Gas Emissions: Estimating Market-mediated Responses.” The paper was authored by Thomas W. Hertel of Purdue University and five co-authors. In a nutshell, the authors argue that the greenhouse gas emission reductions from corn-based ethanol are canceled out when factoring in the increased carbon output from indirect land use change. Therefore, their contribution to California’s Low Carbon Fuel Standard is negligible, even when compared to conventional petroleum based fuels.

There are so many things wrong with this paper that I had a hard time deciding where to begin.
Read the rest of this post…

It appears as if two things peaked in 2007…our economy and our thirst for driving. According to an article in McClatchy Newspapers, U.S. gasoline consumption peaked in 2007 and has not only not recovered, but never will – even after the recession ends. According to Steve Everly, the author of the article, there are several reasons why.

1) Federally mandated fuel economy increases.

2) The number of vehicles on the road will hit a plateau. Get this. There are 4-5 cars on the road for each person in the U.S. including children who can’t legally drive.

3) There will be enough alternative fuels to cover increased fuel needs (which up until 2007 grew each year since we discovered our love for driving using petroleum).

“We’re on a slow but inexorable path away from petroleum,” said James Williams, an analyst with WTRG Economics, an oil and gas consultancy. “This is a big deal.”

While this is good news for consumer pocketbooks, this is not such good news for oil companies who will lose billions of dollars each year from declining gas sales. According to the article, many oil companies are looking at adjusting their refinery capabilities, including the possibility of shutting some of them down. But this doesn’t mean petroleum will disappear. The Energy Information Administration predicts that by 2035, petroleum still will provide 88 percent of the fuel for cars and light trucks.

I’ll let you decide if this is good or bad news.

AAA has already made up its mind about increasing amount of ethanol allowed in gasoline to 15 percent, but they want to know what you think.

The headline for an article posted by the automotive organization last week reads “Bailout Blend: Bad for Your Engine?” and proceeds to bash ethanol as being bad for consumers.

“How would you feel about a fuel additive that could cost you more money and screw up your engine? If the ethanol industry has its way, that’s just what you might get,” they begin, calling an increase to E15 “a bailout for the ethanol industry that may come at the expense of drivers.”

At the end of the one-sided article, AAA asks for your opinion. “Do you think adding E15 to the nation’s fuel supply is a good idea? Log onto AAA.com/Poll and take our poll.” Not surprisingly, the poll is running two to one against E15. Maybe it’s because the article doesn’t say anything about the EPA findings that ethanol is better than conventional gasoline when it comes to greenhouse gas emissions, reducing them by at least 20 percent. AAA says, “Producing ethanol is an energy-intensive process that still results in greenhouse-gas emissions. It won’t save the planet as it still produces pollutants.” It may not save the planet, but it can help cut greenhouse gas emissions by cutting at least some of our gasoline use.

As far as engine issues and mileage concerns, Brazil runs up to 25% ethanol in its cars with no problems, and they consider energy independence to be more important than a few less miles to the gallon.

*post update*
If the link to the poll in the post doesn’t work, try the link in the AAA article. Apparently after you vote, you can’t go back to that link at all, so I can’t get the poll link to add to this post.

Yesterday I wrote about one of the major challenges facing leaders who will be participating in the Copenhagen Climate Conference – global warming. Today, I’m addressing a second major issue facing the leaders – stopping deforestation. There is a misnomer that the main driver of deforestation is the increased production of biofuels. While there is a correlation between biofuels and deforestation, it is minor compared to the real driver – the trees are worth more cut down than they are standing. Let me explain.

Some of the poorest people in the world reside in the regions in and around the Brazilian Amazon rainforest. To survive, they cut down the trees and sell them. Although there have been attempts to ‘block’ this wood from international markets, these efforts have not been successful. Once the trees are cut down, cattle farmers move in and once the land has been over-grazed and the cattle move on, farmers often begin growing soybeans. Another point of interest is that sugarcane does not grow well in the Amazonian region; however, laws have been passed that prohibit the expansion of sugarcane production on native vegetation.

According to The Breakthrough Institute, “The main drivers of Amazonian deforestation are socio-economic. Yet decades of environmental policy have failed to take this basic truth into account.” If we’re going to keep the rainforest intact, then the people who live in the region will need to be given new opportunities to generate wealth that are worth more then selling the trees.

During the climate talks next week, leaders will be attempting to create policies that will address the urban poverty drivers of deforestation. I was in Brazil last week and in prepartion for the meetings, the Brazilian Climate Alliance has prepared a report with recommendations to reduce/climate deforestation. The proposed policies will be released during the conference and the world will be watching.

The countdown to the Copenhagen Climate Change Conference is on as the talks begin in six days. The conference, December 7-18, 2009 is a meeting of the UN to hash out a successor to the Kyoto protocol that is set to expire in 2012. The aim is to prevent global warming, and similar talks date back to the 1992 Earth Summit in Rio.

While we haven’t focused much on Copenhagen on this site, alternative energy will play one of the biggest roles during the summit for its potential to curb worldwide greenhouse gas emissions. According to an article in the Guardian, “Climate scientists are convinced the world must stop the growth in greenhouse gas emissions and start making them fall very soon. To have a chance of keeping warming under the dangerous 2C mark, cuts of 25%-40% relative to 1990 levels are needed, rising to 80%-95% by 2050. So far, the offers on the table are way below these targets.”

What I find most interesting is that while there appears to be a scientific consensus on the existence of global warming and that it is caused by greenhouse gas emissions, mainly CO2, there are still many scientists who don’t agree. As such, the question must be asked, should we be moving forward so quickly both in the U.S. and around the world, on climate policies based on greenhouse gas emission reductions?

Now, before you shoot me and accuse me of being indifferent to the environment and human health issues, less pollution is always good and many economists predict that the next “Green Revolution” (the first one was in the 70s) will help our country rise above the recession. That said, I do believe we need to do something, I’m just not convinced the options on the table are the right ones.

Therefore, over the next week, I’m going to be offering three views on climate change as laid out in three books focusing on global warming. From there, it’s up to you to decide what direction worldwide leaders should be taking.

Oi from Brasil! I have spent the last three days learning about the ethanol industry in Brazil. I have been traveling with a group of 20 international journalists in the State of Sao Paulo, where 60 percent of the country’s sugarcane is grown and consequently where the majority of the ethanol is produced.

I’ll be writing a series of posts about my trip over the next week but I can sum up my experience in one sentence. Where there is a will, there’s a way. When the country of Brazil decided in the 1970s during the oil crisis that it would become energy independent, it did. Today, Brazil gets the majority of its energy, both renewable and fossil fuel based, within its boarders. In addition, the majority of the ethanol produced in the country stays in the country.

Also, unlike the U.S., Brazil produces most of its electricity needs from renewable sources as well. Today, more than 80 percent of its power comes from hydroelectricity, but this poses a problem during drought conditions and will be a bigger problem as water issues become more paramount. A solution? To sell the extra electricity from the sugar mills into the grid during the months the plants are operational, which happens to be during the dry time of the year. UNICA, the organization that represents the Brazilian sugarcane industry, predicts that sugarcane could supply 15 percent of the power by 2017.

While I don’t agree with all of Brazil’s polices and many in the country agree there have been some good and bad decisions, they offer the world demonstrable options and thus, a shorter learning curve to solid energy policies and technologies.

You can take a virtual tour via my Flickr account. Until tomorrow, Tchau.

Many states look to California to set the stage for environmental and energy reform. They passed the first greenhouse gas emissions legislation. They passed the Low Carbon Fuel Standard. But not so fast. They are bankrupt. They still have some of the worst air pollution in the country. They still have “brownouts” when it rains.

Let me give you an example of why California should not set the stage for energy reform. Just today, Biofuels Digest reported that BlueFire Ethanol, a waste -to -energy biofuels company primarily using wood waste, is relocating its second facility from California to Mississippi. Why? A $1 million a year tax hike plus after two years, difficulty getting the permits through. Oh, and did I mention that the DOE threatened to pull its $40 million funding if the project wasn’t sped up?

So BlueFire has sped up. In Fulton, Mississippi.

“We wanted to move quicker, and DOE said we needed to move quicker than we were able to in California,” said BlueFire CEO Arnie Klann in the Digest. “The Economic Development people in Mississippi, and in Itawamba county, welcomed us, and facilitated the project in every way. After going through a 20-month process with our Lancaster facility in California, we expect to be done with permitting by the end of the first quarter, after starting in July, and we have already located an off-take partner for our ethanol, upriver in the Memphis area.

While the plant relocation is great news for Mississippi, it’s sad news for California which will now lose nearly $8.3 million is tax revenue. And let’s face it. This is not the only biofuels project to flee California, nor will it be the last one. If our country is really commited to energy reform then it must not follow the ways of states like Califonia, but follow the lead of states like Mississippi that are welcoming biofuels projects with open arms.

Earlier this week, National Wind CEO Leon Steinberg, challenged President Obama to take a stand by insisting that legislators pass an energy bill establishing a federal oversight committee to implement an interstate transmission highway. Steinberg likens the challenge as similar to President “Ike” Eisenhower’s initiative of creating a federal interstate system. The only difference is that while the nation’s interstate system is for cars, the transmission highway is for electricity.

The Midwest is prime real estate for wind energy, especially Nebraska, North and South Dakota, Minnesota, and Iowa enabling the states to produce more energy than the people need. However, today, it is nearly impossible to capture and transfer the excess energy from wind turbines for use in overpopulated areas like California. The next logical step is to design a way to do just this all while providing lower cost energy to consumers.

Just like the biofuels industry is struggling to increase the blend wall (if not the country can’t meet the 36 billion gallons of biofuels by 2022), the electrical industry cannot meet President Obama’s goal of 25 percent of electricity from renewable sources by 2025 if the grid is not overhauled and upgraded.

Steinberg writes in an op-ed piece, “President Obama’s goal of securing 25 percent of our electricity from renewable sources by 2025 is restricted by state regulators who act only in the interests of their state and disregard the potential benefits of new, high capacity, interstate transmission line.” If the country is serious about energy security, he continues, then the President should emulate Eisenhower’s approach and, “demand action by Congress to bring our energy infrastructure into the 21st century.”

As many have said and will continue to say, including Steinberg, our government needs to get out of its own way in order to usher in new environmental and economic security for generations now and to come.

This is the car you will drive if the Climate Bill passes the Senate.

A new Rasmussen Reports national telephone survey shows that 42 percent of Americans oppose the climate bill that passed the House last week because respondents believe the bill will hurt the economy. Well, the more I dig into the nuances of the proposed climate bill, the more I realize that this bill will do more damage than good.

Here are five reasons why the climate bill will ruin your life:

1) You won’t be able to sell your house if it doesn’t pass an energy audit. If your house fails, you’ll have to reduce the price of the house or update the house until you can pass the audit. Here’s an incentive that’s sure to rejuvenate the housing market.

2) The bill would require that all buildings built in the U.S. conform to meet California Building Code Standards. Who needs an affordable house anyway?

3) Your energy bills and other expenses will be higher. The republicans are complaining that the bill would raise yearly electricity bills $175 per year by 2020 but some experts say that an average family’s expenses will go up between $1,200 to $3,000 per year. Break out the summer fans and winter sweaters and blankets.

4) CRAP and RAID – also known as cap and trade.  The legislation mandates a 17 percent cut in greenhouse gas emissions by 2020 and an 83 percent cut by 2050. These cuts will be “enforced” in part through a cap and trade system which puts a price on CO2 emissions. With a program this well thought out, how could it not work?

5) The government will tell you what kind of car you can drive. No more gas guzzling SUVs people. Start peddling – you need the exercise anyway.

Now, I could be wrong. The Republican filibuster on CSPAN last Friday nearly put me in a coma, but seriously people, this bill needs an overhaul.

In a speech on Wednesday not far from the corn fields of proud Missouri farmers, Republican presidential candidate Senator John McCain blamed subsidies for higher food prices.

“My administration will reduce the price of food by eliminating the subsidies for ethanol and agricultural goods,” McCain told an invitation-only group at the Harry Truman Library in Independence, Missouri. “These subsidies inflate the price of food, not only for Americans but for people in poverty across the world, and I propose to abolish them.”

The senator has previously said that he was opposed to the 2008 Farm Bill calling it “a bloated piece of legislation that will do more harm than good for most farmers and consumers.”

McCain has been in the Senate for almost 20 years. Surely he knows that of the $307 billion in spending authorized by the bill through 2012, $209 billion is for nutrition programs and $25 billion is for conservation. Only about $35 billion goes to agricultural commodity programs, including research and market promotion, with just a portion going in direct payments to farmers.

“Agricultural goods” for the most part are food. America has the safest, most affordable and most abundant food supply in the world – and that is due largely to our farm programs. Like any government program, they can certainly stand improvement. But to make a blanket statement that subsidies for agricultural goods are inflating food prices is just unfair. Congress is on the brink of providing $700 billion in “subsidies” for financial institutions that have made bad investments in order to keep them solvent. A few billion to support our nation’s food supply and the development of alternative energy sources to wean us off foreign oil pales in comparison.