The Ethanol Farce

November 26th, 2007 by Grant in: Alternative Energy, Economics, Energy, Oil & Gas, Politics
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I’ve always been skeptical of the true value of running a vehicle on ethanol. I feel that the next great propulsive fuel must have a net energy content greater than gasoline. Scientifically, this means that the energy content of a given amount of future fuel must be greater than gasoline. Currently, I believe the prime candidate for this is hydrogen.

But I digress. Back to the ethanol farce.

chevy tahoeI came across a Consumer Reports revelation from 2006 presenting the results of their gasoline vs. ethanol tests. They ran a battery of tests on a new (2007) flex-fuel Chevy Tahoe, which can run on E85 or gasoline, and found that the SUV’s mileage dropped from 14 mpg to 10 mpg on E85. They went on further to say that the results of this test could be applied to any flex-fuel vehicle, because naturally, ethanol has a lower energy content than gasoline.

Ethanol has 75,670 BTUs per gallon instead of 115,400 for gasoline, which means that you would have to burn more fuel to generate the same amount of energy.

Additionally, if you adjust for the lower fuel economy, it’s also more expensive to fuel up with E85 than with gasoline. The price of E85 was about $2.91 per gallon in August of 2006, so if you adjust for the ~28% decrease in fuel economy, you’re actually paying upwards of $3.90 for a gallon of E85. Compare that to the national average of gasoline, and you can see that the economic attractiveness is not all that great.

But ethanol will lower our dependence on foreign oil… won’t it?

Not so fast.

The government credits vehicles that can run on E85 with about two-thirds more fuel economy than they actually get using gasoline, even though they may never run on E85. For example, the two-wheel drive version of the Tahoe used in the study would normally be rated at 21 mpg. But because it can run on E85, it earns a 35 mpg credit, even though the Consumer Reports shows it achieves 30% LESS fuel economy on E85!

The net effect is that consumers are being lured into buying bigger, flex-fuel vehicles like the Tahoe based on the fuel economy sticker on the window, which is highly misleading.

Couple that with the fact that the majority of the country can’t buy E85, and you’re back to burning straight gasoline…

Sounds like you’re a typical anti-alternative energy guy!

cornNot really. I’d love to be able to stick it to the foreign oil producers like Chavez and Ahmadinejad. To all up and go cold turkey on oil imports would tickle me to death.

However, I think our science in the United States is being driven more by politics than it is by scientific facts. We’ve bought into the ethanol farce in the name of foreign oil and global warming (another scientific farce driven by politics). Now that we’re burning corn in cars, our politicians can gloat that they’re making “great efforts” to curb our dependence on foreign oil and simmer our influence on global warming.

The average misinformed American consumer buys their plight hook, line and sinker.

9 Comments

  1. Money Blue Book

    We’re not there in terms of our alternative fuel usage. But if you look at nations like Brazil that have transformed their entire fuel usage into ethanol and flex, it’s a do-able goal. It will take time and research though.

    Corn is very inefficient for generating ethanol…sugarcane and straw cellulose are better, but corn has been getting more press coverage recently…not sure why.
    -Raymond

  2. Jonathan C

    Grant,

    I am a loyal Iowan, and couldn’t agree with you more. Here in Iowa, farmers and private investors are–for the moment–making a small fortune as a result of federally subsidized ethanol, but it can’t last in the long run because the science just doesn’t support it.

    I strongly agree with your point that scientific research today is being driven by politics, and it is resulting in a lot of wasted effort, money, time, and energy. Not to mention higher taxes. As a general rule of thumb, if private money isn’t interested in developing a concept or market (in the absence of subsidies, that is), they *probably* have a good reason.

    Jonathan

  3. dong

    I’m not a huge ethanol either as it’s not a particularly efficient source of energy given the energy input required to grow corn to turn corn into ethanol. However, I’m confused by your statement that an alternative fuel needs have greater energy content than gasoline. What do you mean by that? Energy to weight ratio?

  4. Grant

    Hey Dong,

    The energy content is typically measured in BTU’s per unit volume.

    For instance, regular 91 octane gasoline delivers 125,000 BTU’s per gallon, where as ethanol only delivers 84,600 BTU’s per gallon.

    I believe that to have a reasonable alternative to gasoline, we’ll need a naturally occurring resource other than petroleum that has a higher energy content than gasoline.

    Thanks for chiming in!

    -Grant

  5. dong

    I guess I’m not as concerned with the energy content as long it’s above a certain level. It’s not like E85 vehicles need to have these gigantic tanks that they outsize their gasoline counterparts. Really in the end though I think if we can find a sustainable environmentally friendly fuel that’s cheap to produce, I think we’ll figure out the rest. You can always use the electric grid as alternative method of fuel transportation for electric cars…

  6. Grant

    Dong, it’s not the fuel efficiency of the cars themselves that presents the rub in the problem, nor does the size of the tank.

    The problem comes in when you consider the overall net energy return of ethanol vs. gasoline.

    For instance, how many gallons of gasoline does it require to produce a gallon of ethanol, and could that energy use be better served producing food than fuel?

    Ideally, we’d like to see a positive net output of energy (i.e. it only requires 6 gallons of gasoline or ethanol to produce 10 gallons of gasoline or ethanol).

    As for using electricity to provide locomotion, I agree, but remember that it takes an energy source to produce electricity. And is that energy source a clean and efficient one (comparing coal to natural gas to oil, etc…).

    -Grant

  7. Matt D

    The biggest reason that ethanol won’t work is corn. Corn is a highly ineffiecent way to create ethanol. Brazil uses sugarcane which in that country is readily available, easily grown, and breaks down in to ethanol much more easily. I guess the real crop that may turn out to work best in the US to make ethanol is actually switchgrass, who knew. Additionally, I think is more important to get the ethanol to be produced cheaply, which corn doesn’t really do well. If we had a choice between E85 for $1.50/gal vs. $3.00/gal, you would see this take off.

    Also, I wouldn’t expect to see ethanol ever completely eleminate gas but in some places you can certainly see it help with gas prices. If you live in Kansas, drive to your local Casey’s General Store notice the 90 grade is made with 10% ethanol and is typically cheaper than the 87 grade which is all gas. I think this is where you will see it used more than in the E85 setup.

    Finally, biodiesel will probably be the more likely play as an alternative resource. In the US, until Honda and GM start producing there highly efficient european diesel engines here in the US, we won’t see a change for awhile here. I think both are slated to have some sort of product here in 2009 or so.

    Until then it’s go go gadget hybrid…by the way who killed the electric car?

  8. Grant

    Matt, to expand on your comment a bit, it is important to produce ethanol (or any other alternative fuel for that matter) cheaply without increasing the cost of another commodity as a byproduct. Using corn is a prime example. Use all the corn to produce ethanol and it drives food products up.

    I like the biodiesel idea, and I think it’s the most practical way to go, but it would take a long time to standardize the fuel due to up front equipment requirements.

    Thanks for contributing.

    -Grant

  9. The Corner Office Blog - An entrepreneurs thoughts on business, personal finance and investing. » Blog Archive » Fuel Standards and Ethanol

    […] like the push for ethanol, even though I think it’s still a farce. If we can figure out a way to produce ethanol with a net energy gain, I’m all for it. I also […]

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