| For the week of July 24, 2006 |
Ethanol Skeptics Don’t Get It |
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In news from the year 2070, the Organization of Ethanol Exporting Countries meeting in Minneapolis assured jittery Arab nations that ethanol prices and supplies will remain stable despite a drought in the Midwest.
Wouldn’t that be refreshing news about energy? But this is 2006 not 2070, so instead we read of warnings from Iran that it will slow down the flow of crude oil from the region if it is punished for pursuing a nuclear program.
The world economy and energy prices have been held hostage by hostilities in the Middle East for some time now. The inflamed rhetoric of a few Arab leaders and terrorist organizations is intended to hurt the United States and Europe by driving up gasoline prices. Fear and psychology are playing a big role in the price of oil.
Thank goodness for U.S. agriculture and the accelerating development of biofuels. This is one way to push back on the oil fears and reduce dependence on Persian Gulf oil.
But higher oil prices seem to be producing more skeptics and detractors of ethanol at the same time. They don’t like tax incentives for ethanol production. They question the net energy balance – whether ethanol requires more fossil fuels to make than it replaces. When this argument was satisfied they moved on to other objections.
Lately, critics are claiming that ethanol production will use up all the farmland and displace food production. Essentially, they’ve gone from saying ethanol isn’t getting us anywhere to saying ethanol is going too far.
Some detractors hold out hope for more exotic fuels like hydrogen. Others think the world will go on finding more oil or conserve it better. Critics underestimate farm productivity and the research into farm-based fuels.
Those that do get it include the American Farm Bureau Federation, the U.S. Department of Agriculture, General Motors, Royal Dutch Shell, BP, Archer Daniels-Midland, DuPont, Goldman Sachs Group, Bill Gates, President Bush, President da Silva of Brazil – and many other big names who support biofuels.
No one is expecting biofuels to replace fossil fuels, but they can play a greater complementary role and displace much of the oil we are importing from the Persian Gulf. Biofuels can be an important placeholder in the energy mix until something more revolutionary comes along, but that could be fifty years or more down the road.
A technical advisory committee to USDA and the Department of Energy determined that biofuels can supply 20 percent of the nation’s transportation fuels by 2030.
Another goal endorsed by many in agriculture is for America’s working lands to provide 25 percent of total energy consumed in the United States by 2025 while continuing agriculture’s outstanding record of food and fiber production.
Agriculture will prove the skeptics wrong.
Stewart Truelsen is a regular contributor to the American Farm Bureau Federation’s weekly Focus on Agriculture series.