Corn Ethanol: Possible, but Ineffective as Alternative

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Friday, May 09, 2008

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Corn Ethanol: Possible, but Ineffective as Alternative

MINNESOTA - A recently released World Bank study estimates that corn prices “rose by over 60 percent from 2005-2007, large because of the United States ethanol program combined with reduced stocks in exporting countries.”

According to Alex Murphy, the sudden burst in the popularity of corn ethanol in the United States and the implementation of subsidies for it constitute a gross example of faux-environmentalism that serves national interests at great expense to the world food market.

Corn ethanol seems appealing, as it is effectively a farming subsidy that makes the United States more energy-dependent. However, the costs far outweigh these marginal benefits that are based in either self-serving national interests or ideological foreign policy. The two primary problems with corn ethanol in the United States are the questionable environmental value of ethanol as an alternative to gasoline and the vastly onerous effect it is currently having on world food prices.

The energy balance of corn ethanol is extremely poor in the United States. Energy balance is basically the ratio between the amount of fossil fuel energy that needs to be expended to produce a biofuel and the actual energy output. Corn ethanol generally produces 1.3 energy units for every unit of fossil fuel energy committed to its production. A more efficient form of ethanol like that made from sugarcane in Brazil produces approximately eight energy units for every unit of fossil fuel energy. The meaning of this is that the United States expends a huge amount of fossil fuel in the creation of its corn ethanol and fails to increase its energy self-sufficiency by a large margin.

A recently released World Bank study estimates that corn prices “rose by over 60 percent from 2005-2007, large because of the United States ethanol program combined with reduced stocks in exporting countries.” The sudden burst in the popularity of corn ethanol in the United States and the implementation of subsidies for it constitute a gross example of faux-environmentalism that serves national interests at great expense to the world food market.

Corn ethanol seems appealing, as it is effectively a farming subsidy that makes the United States more energy-dependent. However, the costs far outweigh these marginal benefits that are based in either self-serving national interests or ideological foreign policy. The two primary problems with corn ethanol in the United States are the questionable environmental value of ethanol as an alternative to gasoline and the vastly onerous effect it is currently having on world food prices.

The energy balance of corn ethanol is extremely poor in the United States. Energy balance is basically the ratio between the amount of fossil fuel energy that needs to be expended to produce a biofuel and the actual energy output. Corn ethanol generally produces 1.3 energy units for every unit of fossil fuel energy committed to its production. A more efficient form of ethanol like that made from sugarcane in Brazil produces approximately eight energy units for every unit of fossil fuel energy. The meaning of this is that the United States expends a huge amount of fossil fuel in the creation of its corn ethanol and fails to increase its energy self-sufficiency by a large margin.

It is also extremely questionable whether corn ethanol is even more environmentally friendly, particularly after all the factors involved in its production are accounted for. Most commonly accounted for are the emissions in growing the corn, transportation to the factory, processing it into ethanol, and other obvious sources. However, assessments may commonly omit other emissions sources involved in the use of ethanol, references to the change in land-use from an increased demand for corn, which may also include problems concerning water supply due to the farming practices required for corn.

Even if using corn ethanol did have a demonstrably powerful impact to reduce environmental harm, it would not excuse the gross effect U.S. subsidies of ethanol are having on international food prices. As I mentioned, food prices have been dangerously rising in the past few years, and a large portion of that increase can be attributed to increasing ethanol production.

Rising food prices aren’t entirely destructive in developed nations, but in nations with large food insecure populations it can easily lead to widespread famine without substantial intervention that isn’t even feasible worldwide and certainly isn’t worth the modest gains from the use of ethanol.

On a basic level, increasing usage of ethanol decreases the supply of food which, in turn, given steady demand, increases food prices. Land that would otherwise be used for food production is reconstituted for energy production. While ethanol advocates argue that it is largely made from food that would be used for livestock and as such would not affect food prices, that increase in livestock food prices creates an increase in cost in the food market.

Virtually everyone agrees that ethanol has increased the cost of food, even industry studies acknowledge that ethanol contributed to 4 percent of the increase. President Bush has attributed 15 percent to ethanol and the United States Department of Agriculture attributed 20 percent to it. An International Food Policy Research Institute report that is to be released will attribute 30 percent to increasing ethanol usage. A researcher from the same institute, Joachim von Braun, has claimed that the abolition of biofuel use among developed nations would decrease corn prices by 20 percent and wheat prices by 10 percent.

Developed nations, including and primarily the U.S., should abolish domestic biofuel subsidies. Opening their markets to more efficient forms of biofuels such as Brazilian sugarcane ethanol would be preferable. Subsidies on ethanol are effectively acting as a tax on staple foods that poor populations of developing nations depend on most. Farmers in developed nations ought to choose what to grow based on the market, not subsidies. The protectionist practices of the U.S. in defense of its farmers have caused significant harm to agriculture in developing nations and at least this one practice should be abandoned.

Inflated food prices that may easily lead to massive starvation are not acceptable. The environmental impact of ethanol isn’t demonstrably different than that of gasoline and ethanol doesn’t make the U.S. substantially more energy self-sufficient. The obsession with ethanol is also preempting more effective environmentalist solutions and decreasing the drive for realistically efficient replacements for gasoline. To both minimize the effects of the world food crisis and to redirect the focus of environmental efforts toward effective solutions, developed nations should abandon their inefficient biofuel subsidies at least until a more feasible solution is brought forward. In the meantime, these governments should actively support inquiry into alternative sources of energy, and this one time set their politics aside to allow reasonable solutions to take precedence over easy political solutions that appear to be addressing problems that they are, in fact, exacerbating.