Be that as it may, the “scientific” studies that show ethanol to be cost-effective all seem to be sponsored by companies that would benefit from the sale of ethanol, which would suggest that such studies are not unbiased.

But the biggest problem with ethanol is that it steals vast swaths of land that might be better used for growing food. In a recent article in Foreign Affairs titled “How Biofuels Could Starve the Poor,” University of Minnesota economists C. Ford Runge and Benjamin Senauer point out that filling the gas tank of an SUV with pure ethanol requires more than 450 pounds of corn — roughly enough calories to feed one person for a year.

From Rolling Stone (Aug 09, 2007)

“When you take this into account, most of the biofuel that people are using or planning to use would probably increase greenhouse gasses substantially,” said Timothy Searchinger, the lead author of one of the studies and a researcher on the environment and economics at Princeton University. “Previously, there’s been an accounting error: Land use change has been left out of prior analysis.”

Plant-based fuels were originally billed as better than fossil fuels because the carbon released when they are burned is balanced by the carbon absorbed when the plants grow. But even that equation proved overly simplistic because the process of turning plants into fuel causes it own emissions - through refining and transport, for example.

The land-use issue makes the balance sheet far more problematic: The clearance of grassland releases 93 times the amount of greenhouse gas that would be saved by the fuel made annually on that land, said Joseph Fargione, the lead author of the other study and a scientist at the Nature Conservancy. “So for the next 93 years, you’re making climate change worse, just at the time when we need to be bringing down carbon emissions.”

http://www.iht.com/articles/2008/02/07/healthscience/biofuel.php

USAID officials said that a 41 percent surge in prices for wheat, corn, rice and other cereals over the past six months has generated a $120 million budget shortfall that will force the agency to reduce emergency operations. That deficit is projected to rise to $200 million by year’s end. Prices have skyrocketed as more grains go to biofuel production or are consumed by such fast-emerging markets as China and India.

http://www.msnbc.msn.com/id/23418142/

http://www.msnbc.msn.com/id/23057867/

The Economist’s food-price index is higher today than at any time since it was created in 1845 (see chart). Even in real terms, prices have jumped by 75% since 2005. No doubt farmers will meet higher prices with investment and more production, but dearer food is likely to persist for years (see article). That is because “agflation” is underpinned by long-running changes in diet that accompany the growing wealth of emerging economies—the Chinese consumer who ate 20kg (44lb) of meat in 1985 will scoff over 50kg of the stuff this year. That in turn pushes up demand for grain: it takes 8kg of grain to produce one of beef.

But the rise in prices is also the self-inflicted result of America’s reckless ethanol subsidies. This year biofuels will take a third of America’s (record) maize harvest. That affects food markets directly: fill up an SUV’s fuel tank with ethanol and you have used enough maize to feed a person for a year.

http://www.economist.com/opinion/displaystory.cfm?story_id=10252015

Cheap gas has been responsible for people moving away from urban centers into the suburbs since commuting was cheap. Cheap gas actually encourages people to alter their habits and drive more. Now we have expensive gas and changing habits and lifestyles will take some time. People will look to more efficient vehicles on their next purchase and will look for housing closer to work.

And ethanol may be a small piece of the pie but it is growing. But this isn’t a static system yet everyone treats it like it is. At the present ethanol, adjusted for energy content makes up about 3% of the gasoline supply. If through buying more efficient cars, moving in closer to work, and better fuel economy standards gasoline consumption is cut in half then ethanol becomes 6% of the supply even without any further production increases. Then if cellulosic ethanol becomes available and triples production you are talking about 18% of the gasoline supply.

If you are going to look at ethanol subsidies you should also look at the money that goes to the petroleum industry as well. From the sweetheart deals on off shore royalties the Clinton administration made in the 1990’s that allow oil to be pump from the gulf royalty free. That is estimated to be $60 billion over 20 years. And look at things like the depletion allowance and the costs incurred by the military to protect oil shipping lanes in the Persian Gulf.

As for the 54 cent tariff. Look at biodiesel it has a subsidy but no matching tariff. Companies in other countries are sending ships here loaded with biodiesel and blending in petroleum diesel at the port, collecting the subsidy then shipping the biodiesel off to mainly Europe to be sold. It is a tactic called “splash and dash” and has us in hot water with EU. They have or are considering filing an anti-dumping complaint against us with WTO. The tariff simply offsets the subsidy. Yes, I know there is a 3 cent difference but the subsidy used to be 54 cents as well.

Economists argue that making ethanol from corn wouldn’t make any sense without the government’s help. The mix of federal and state subsidies to corn ethanol amounted to a conservative estimate of $5 billion to $7 billion in 2006, says Koplow of Earth Track. A considerable chunk of that money comes from the 51¢ tax refund for each gallon of ethanol refiners blend with gasoline to make fuels that can power flexible-fuel cars.

At the same time, the government imposes a 54¢-per-gallon tariff on ethanol from Brazil, which is a cheaper and more energy-efficient product made from sugar cane.

For the full article, go here.

I didn’t know about the TARIFF on Brazilian bio-fuels.  That tariff speaks of a big self-interested LOBBY for corn.

What if we put a 51-cent per gallon equivalent subsidy toward solar or toward conservation? How much further along toward having a sustainable energy policy would we be now?

I don’t believe that we’re suddenly going to run out of energy next year or the next year. My big concern is that there is going to be an inexorable ramping up of the cost of gasoline over the next few years–that it could go up a dollar per year based on dwindling supplies and increasing worldwide demand. I’m concerned with the kind of stress that could put on our fragile economy, including the risks of rampant inflation.  http://dangerousintersection.org/?p=87

I’m tired of hearing about corn as the solution. Perhaps, as you suggest, corn can play a role (I’m still skeptical). When people utter “corn” as a fuel, they need to say out loud that it is one tiny piece of the puzzle, at most.

I consider sensible energy policy to be inextricably tied to national security. I want to hear a coherent political message about the need to change our profligate use of energy here in the U.S. so that we make ourselves less vulnerable to the many challenges and dangers over the horizon.