According to a new report from the New York Times, the ongoing drought in the Midwest is causing the American biofuels industry to begin crumbling around the edges.
The United States has mandated for several years that gasoline contain 10 percent biofuel — a requirement generally met with corn-based ethanol. It also maintained a tax credit for ethanol of 45 cents per gallon, though that was allowed to expire at the end of 2011. That led to the establishment of hundreds of ethanol plants throughout the Corn Belt, and communities which in turn heavily rely on those plants for their livelihoods.
But now it looks like the punishment Midwest corn yields took from the drought — one Cairo, Missouri farmer quoted in the piece said his corn crop last year was just 5.5 percent of his usual yield — has driven the price so high that ethanol plants are being forced to shut down:
Nearly 10 percent of the nation’s ethanol plants have stopped production over the past year, in part because the drought that has ravaged much of the nation’s crops pushed commodity prices so high that ethanol has become too expensive to produce.
The other half of this is falling demand for gasoline — a result of both the recession, and a renewed policy push for electric and hybrid vehicles and tougher fuel economy standards. Most cars can only take a fuel blend of only 10 percent ethanol, and most service stations are set up to only handle that amount, resulting what’s referred to as the “blend wall.” The Environmental Protection Agency allows for blends of up 15 percent, but cars that can take that haven’t caught on in the marketplace. Nor have “flex-fuel” vehicles, which can take up to 85 percent.
That’s left ethanol with a smaller amount of gasoline to be blended with, squeezing the industry:
Thousands of barrels of ethanol now sit in storage because there is not enough gasoline in the market to blend it with — and blends calling for a higher percentage of ethanol have yet to catch on widely in the marketplace….
[Demand for fuel] has shrunk to 8.7 million barrels a day from 9.7 million in 2007, said Larry Goldstein, an economist and a director of the Energy Policy Research Foundation. And with corporate average fuel economy rules now in place to double the number of miles that the average car gets per gallon by 2025, “you know we’re on a trend,” he added.
Globally, the combined effect of U.S. and European biofuel policy has been a massive divergence of corn crops into biofuel production, which in turn drove up the price of corn and contributed to global food insecurity. Much of the carbon-reducing benefits of biofuels are diluted if not reversed entirely by the carbon output from the agricultural production required to produce them. Nor does the conversion of more grasslands and forest into biofuel cropland to take advantage of the higher prices help, as those environments actually sequester more carbon that cropland.
Cellulosic biofuels, by relying on crops that don’t double as food, could provide a solution. But whether they can be widely commercialized without requiring high levels of water and land use remains an open question.
All told, our reliance on biofuels as an answer to the challenge of climate change has been an ongoing policy and humanitarian disaster, so there’s a certain irony now that the droughts and extreme weather driven by climate change are starting to eat away at the biofuel industry itself.
Of course, the people paying the price of that irony aren’t the Beltway insiders who developed America’s biofuels policy. They’re the global poor, as well as the everyday working Americans whose communities and towns are being threatened by the loss of the plants. The plant in Cairo, Missouri had been buying 16.5 million bushels of corn per year before it shut down. And the town of Walhalla, North Dakota is bleeding families due to the closure of its plant.
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This article looks like something straight from the annals of the fossil fuel industry.
1. The primary contributor to climate change is fossil fuels, not biofuels.
2. So to say the climate change induced drought was caused, in any substantial part, by biofuels is ludicrous.
3. If the ethanol industry collapses, as this article appears to hope, we can expect gasoline prices to continue to rise as ethanol represents a nearly 1 million barrel per day fuel supply.
Yes, reliance on first gen biofuels does make the food situation worse. And first gen biofuels are certainly a mixed bag when it comes to benefits and detractors.
But reliance on dirty, dangerous and depleting fossil fuels are the primary problem. They have:
1. Increased prices for fuels fivefold.
2. Reduced access to fertilizer due to depletion.
3. And been to PRIMARY driver of climate change.
As for the New York Times, it appears they are edging ever closer to manically declaring that fossil fuels are the solution to climate change.
Overall, the above analysis is misleading and unbalanced.
Jeff Spross wrote: “a massive divergence of corn crops into biofuel production”
And what are corn crops being diverted FROM?
The overwhelming majority of corn produced in the USA is used for animal feed to produce cheap, factory-farmed meat — which is environmentally devastating, and responsible for costly and deadly epidemics of entirely preventable disease, and results in the loss of up to 90 percent of the original protein content of the corn.
And what corn is not used to produce factory-farmed meat is used to make high-fructose corn syrup.
Is using corn to make ethanol worse, or better, than these other uses?
I don’t know. But it is certainly not the case that the pre-biofuel factory-farmed corn industry was benign, or something that we should fight to maintain.
As the United Nations Food and Agriculture Organization and others have documented, the best thing that any of us can do to help agriculture feed the world sustainably is to adopt a vegan diet. Which is something that pretty much all Americans can do very easily, while simultaneously lowering their food costs and improving their health.
And yet, I don’t recall EVER, not even ONCE, seeing an article on ClimateProgress that advocated vegan diets.
We’ve had articles on the climate impact of meat.
There’s a certain irony to, one the one hand, talk about what corn ethanol has done to the world’s poor and food prices in general and, on the other hand, talk about American communities that suffer when the corn ethanol industry goes south. Pick a side!
My opinion – the corn ethanol industry ought to be shut down! We should end all subsidies for corn ethanol and fossil fuels NOW! Burning corn for fuel was a bad idea to begin with. Why not do an article on CO2 emissions from corn ethanol from field to gas tank?
I’m with you, Tucker. Corn Ethanol is responsible for about the same CO2 emissions per gallon as gasoline, with diversion of food crops thrown in. Time to shut it down as a failed experiment.
Reports that claim ethanol is responsible for more CO2 emission than gasoline are ludicrous. They assume that most of ethanol comes from land that is cleared for farming.
Since most land used for ethanol in the US was already farmland, CO2 emissions from ethanol are more than 50% less than that of gasoline.
Each year, we get this same, silly misinformation on ethanol. And, each year, research makes it clear that claims against ethanol are exaggerated. The most important factor, I think, is the fact that US ethanol displaces 1 million barrels per day of oil production. And big oil doesn’t like that one bit.
You can look at the price of corn over the last decade and know that it makes no sense to be burning food for fuel (especially when there are much more efficient ways to make ethanol (talk to the Brazillians), if its even good to make it).
We’ve gone from corn hovering around $2-$2.50 a bushel to close to $7 a bushel with ethanol production helping push that price all the way up – it’s an extravagance we can no longer afford – we can get off oil other ways.
http://www.agmanager.info/livestock/marketing/graphs/Crops/Corn/U.S.AvgCornPr.htm
So you would end US ethanol production just as it is about to make its transition from corn to cellulosic?
Sorry, couldn’t agree less. We’re going to need liquid, renewable fuels if we’re ever going to kick the oil habit.
As for food prices… Population growth and fossil fuel induced drought in almost every major food producing basin were the primary drivers. Had the droughts and massive fossil fuel price increases never occurred, the food price impact would have been minor. So the US has less corn syrup? Good.
It makes sense to burn food if you are speculating in food commodities markets and are going to make a ‘killing’. It makes sense to burn food if you can profit from higher agricultural commodity prices. It makes sense if you see hunger as a useful weapon to create social chaos in states that you wish to destabilise, even destroy and partition. And it makes sense to burn food if you do not care about, or look forward to, mass starvation as a means to reduce the global population of ‘useless eaters’ who you have long feared.
“…most land used for ethanol in the US was already farmland…” so it was used for food but now it isn’t, so you have to count the emissions. If you claim corn ethanol is better for the environment you have to count all the environmental damage it causes; all of it. I didn’t mention the enormous waste of freshwater. I didn’t mention the contribution to nitrogen pollution. All the herbicide too. All of it so you can burn food in the gas tank.
Ethanol plants require an enormous amount of energy to run. The ethanol must be transported to where it is blended with gasoline. That must be transported to the service station. All the CO2 must be counted if you claim ethanol is better for the environment. When you weight all the environmental damage the scales are tipped heavily against it being beneficial.
If the only benefit is that oil companies are upset then natural gas also comes under that heading.
Cellulosic ethanol does not depend on corn ethanol. Cellulosic ethanol might be carbon neutral and might not damage the environment as corn ethanol does but, so far, it is an unfulfilled promise.
Using crops de novo for energy production has never been a good idea. It’s just bad karma to put food into a gas tank in a world where 2.5 billion are chronically malnourished. There’s another way to do this. Think about the billions of tons of carbon-bearing waste we generate each year. Paper, cardboard, plastics, food wastes, lumber; landscaping, forestry and agricultural wastes– it’s a very impressive tonnage. Whether it goes to landfill, sewage plant, or other end fate, almost all of this carbon will end up in the atmosphere in a few months or years. Carbon gets microbially or chemically degraded, and will inevitably end up as one or another 1-carbon gas. Landfills are a particular problem. Buried trash quickly becomes anaerobic as microbes consume the residual oxygen buried with the fuel. Thereafter, all degradation proceeds via fermentation rather than respiration. Fermentation is much less efficient than respiration, yielding much greater quantities of the metabolic end products per gram of microbial mass.. A great deal of the buried carbon is eventually released as methane rather than CO2. And we all know that methane is far more efficient at capturing heat than CO2. If these billions of tons of waste were diverted to fuel and electricity production, the amount of carbon it releases directly is pretty much the same as for not using it. Only in this case, the end product is all CO2 rather than methane. The fuel and electricity produced offsets the use of primary fossil fuels, leading to a net reduction in emissions, and significantly diminished GWP, since the form carbon released can be controlled.
As far as food production, there are a great many crops that generate significant waste when harvested and processed. Waste that can be reclaimed for fuel and energy production. And once again, since agricultural, forestry, and landscaping wastes are quickly converted to CO2 or methane even if not reclaimed, the direct release of carbon is the same for both fates. Grow food, not fuel. Integrate reclamation of the waste generated with harvest and processing. Then you get food and fuel.
This conversation stems from the basic reality that people do not think through the predictable consequences of policy decisions. Environmentalists fought like fiends when it came to eliminating MTBE, which then gave rise to ethanol substitutes.
All of this debate, however, simply delays the inevitable: electrification of transportation. Instead, we continue to try to replicate the myth that liquid fuels are superior and to build infrastructure around that premise.
Arguments over which liquid fuel model is best miss the point and waste time.
By the way, electricity produce from even 12% solar PV panels is 25 times more effective at producing electricity than photosynthetic means leading to fuel used to produce electricity. (That number can be as high as 70 times.) It’s even more effective, if that energy is used for transportation, since much of the fuel’s energy content is wasted in internal combustion motors, no matter how efficient.