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Senior Contributor

Corn Ethanol

Here is an interesting read with numbers on the effectiveness of the ethanol subsidies on actual energy consumption.

http://www.ewg.org/files/EWG-corn-ethanol-energy-security.pdf

"Claim's that corn ethanol is making a major contribution to America’s security and energy independence by reducing oil imports are wildly exaggerated, an analysis by Environmental Working Group (EWG) shows. Between 2005 and 2009, taxpayers spent a whopping $17 billion to subsidize ethanol. In return, they got a reduction in overall oil consumption equal to an unimpressive 1.1 mile-per-gallon increase in overall fuel economy.

 Ethanol’s contribution to reducing U.S. dependence on imported oil looks even worse -- the equivalent of a paltry six-tenths-of-a-mile-per-gallon improvement in fuel economy fleet-wide. This degree of energy independence could have been accomplished for free by proper tire inflation, driving sensibly, obeying the speed limit and using the right grade of motor oil.

In terms of reducing consumption of fossil fuels in the transportation sector, including the fuel needed to produce ethanol and transport it to the market, the payoff is downright dismal. Less than half-of-a-mile-per-gallon increase in fleet-wide fuel economy would yield the same reduction in fossil fuel use as all 10.6 billion gallons of corn ethanol added to gasoline in 2009."

6 Replies
Senior Advisor

Re: Corn Ethanol

Do away with the tax credit and let ethanol sink or swim on it's own. Ethanol is good for the economy. We are adding value to a raw product. We get 3 gallons of ethanol from a bushel of corn and still have 1/3 of a bushel for feed. It is making a better use of a natural resource. It is a way of turning sunlight into usable energy.

Senior Contributor

Re: Corn Ethanol


@r3020 wrote:

Do away with the tax credit and let ethanol sink or swim on it's own.


Lots will agree with you on that but I have a notion there are a lot of others that think without the ethanol subsidy corn prices would be lower as ethanol can not compete as an energy source on the open market.

Of course if we paid the real price of gas at the pumps that would change things too.

 

Advisor

Re: Corn Ethanol

Cultivated corn is a "natural resource"? How's that work?

Veteran Advisor

Re: Corn Ethanol

Bruce, a little slow on the draw today? Sunlight is the natural resource that is being harnassed by the corn plant, and later made into liquid fuel. Hope this helps.

 

It could be done without any petro products, and the resulting corn would be all net gain. Of course, to achieve the lofty yields that we count on, we need enhancements, but you can charge off the petro energy incurred to producing feed stocks, too. And like Canuck said, in the USA we certainly are not paying the true cost of petro derived fuel either.

Advisor

Re: Corn Ethanol

Ok...the sun shines and out jumps corn. Got it. 

 

Is it a little like when the bird crapped on a fence post and the sun hatched Ollie?

 

 

Senior Advisor

Re: Bruce, it was

a poor chioce of words. I should have said we are making a better use of our natural resources. Instead of the starch going into beef and coming out the back end, it is now being converted into fuel to help raise more corn or fuel to help move the rest of the economy. What was once being wasted is now being used.