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June, 2009Ethanol Fails EPA "Stress Tests"
By Dr. Jerome R. Corsi
Largest fuel additive producer in Texas declares bankruptcy
Bank stress tests were not the only stress tests administered by the Obama administration in recent weeks.
Even more bad news for ethanol came earlier this month, when the Obama administration announced ethanol did not get flying colors in the Environmental Protection Agency biofuel stress tests that were mandated by the 2007 energy bill.
As if that were not enough bad news, the largest ethanol producer in Texas has declared bankruptcy this month.
Evidence continues to mount proving the Obama administration's continued support for ethanol can only be justified as a politically important agricultural subsidy, but not as a policy that produces demonstrable carbon emission savings or is viable on strict economic grounds.
Ethanol fails 'stress tests'
Even Time magazine, in conjunction with CNN, was forced to report that the draft conclusions announced by Environmental Protection Agency administrator Lisa Jackson were that the production of renewable corn ethanol can end up producing even more carbon emissions than gasoline.
At a hearing after the announcement, House Agriculture Committee Chairman Collin Peterson, a Minnesota Democrat, accused the EPA of attacking corn and soybean farmers.
"You're going to kill off the biofuels industry before it even gets started," Peterson said, according to the Time magazine report. "You're in bed with the oil industry!"
Calling ethanol a "carbon catastrophe," Time reported that the corn ethanol can produce at best only 20 percent fewer carbon emissions after taking into consideration a host of "life cycle" emissions needed to produce ethanol, including direct carbon emissions created by heavy machinery and petroleum-based fertilizers required to grow corn, energy-intensive ethanol refineries needed to convert corn into fuel, and trucks required to transport ethanol to market.
The net carbon emission impact of ethanol turns negative when researchers take into consideration the land use conversion into producing corn for ethanol.
The land-use problem has been a thorn in the side of ethanol supporters since the 2008 publication in Science magazine of research conducted by Princeton University scientist Tim Searchinger that concluded ethanol production would actually increase net carbon emissions resulting from decisions made by farmers worldwide to respond to higher corn prices by converting forest and grassland to farmland dedicated to producing corn for ethanol.
Searchinger and his colleagues wrote that, "By using a worldwide agricultural model to estimate emissions from land-use change, we found that corn-based ethanol, instead of producing a 20 percent savings, nearly doubles greenhouse emissions over 30 years and increases greenhouse gases for 167 years."
WND reported in April that the California Environmental Protection Agency recently ruled against ethanol, in part because converting land that is now a "carbon sink" to farmland producing ethanol defeats the purpose of California regulations requiring a 10 percent reduction in carbon emissions from fuel used in the state by 2010.
The California EPA agreed with Searchinger that converting land now absorbing carbon dioxide to land producing corn for ethanol would be a bad idea.
Ethanol producer goes broke
The Houston Chronicle has reported that White Energy, the largest ethanol producer in Texas, has filed for Chapter 11 bankruptcy.
The White Energy bankruptcy adds to a string of ethanol industry bankruptcies that in the past two years have called into question the economic viability of the biofuel, despite federal government subsidies that amount to 45 cents per gallon and a federal mandate that requires U.S. gasoline producers to use 12 billion gallons of ethanol this year, with the requirement increasing to 15 billion gallons by 2015.
As Red Alert has reported, a Congressional Budget Office report issued in April, entitled "The Impact of Ethanol Use and Food Prices and Greenhouse-Gas Emissions," revealed the "break-even ratio" of the price per gallon of retail gasoline to the price per bushel of corn is currently about 0.9.
The CBO concluded, "when the price of gasoline is more than 90 percent of the price of a bushel of corn, it is profitable to produce ethanol."
As the price of oil has increased to more than $60 a barrel, the price corn has also increased.
With corn now trading at about $4.25 a bushel, gasoline would have to cost about $3.80 a gallon for the production of ethanol to be profitable, even with government subsidies.
Even with the price increase of oil to $60 a barrel, gasoline continues to average around $2.25 a gallon nationwide.
(c) 2009 RedAlert.WND.com
Jerome R. Corsi is a staff reporter for WND. He received a Ph.D. from Harvard University in political science in 1972 and has written many books and articles, including his best-sellers "The Obama Nation" and "The Late Great USA." Other books include "Showdown with Nuclear Iran," "Black Gold Stranglehold: The Myth of Scarcity and the Politics of Oil," which he co-authored with WND columnist Craig. R. Smith, and "Atomic Iran."
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