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Questions about ETHANOL costs to us...

Old 10-19-2010, 02:52 PM
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Default Questions about ETHANOL costs to us...

I'm taking my question from the Bill Nelson thread and making it a stand-alone thread in hopes that the experts amonst us will share their knowledge about the subject.


Anybody know of studies that show how much reduction in MPG is seen as the result of using ethanol?

Anybody know what the price difference is (to oil companies) to buy equal volumes of ethanol vs. gas?

Anybody know what the cost to consumers (at the pump) is as the result of oil companies having to buy and blend ethanol into their gas?
Old 10-20-2010, 05:31 AM
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Originally Posted by bamaboy473 View Post
I'm taking my question from the Bill Nelson thread and making it a stand-alone thread in hopes that the experts amonst us will share their knowledge about the subject.


Anybody know of studies that show how much reduction in MPG is seen as the result of using ethanol?

Anybody know what the price difference is (to oil companies) to buy equal volumes of ethanol vs. gas?

Anybody know what the cost to consumers (at the pump) is as the result of oil companies having to buy and blend ethanol into their gas?

The EPA tested oxygenates extensively when the 1990 Clean Aair Act was passed and fourn a 2-3% decrease with a 10% blend.

Check the Chicago Board of Trade for ethanol prices and the NY Merc for unleaded (RBOB) prices. Ethanol is currently about a dime higher than unleaded but has been as much as $0.70 cheaper during the last year. Blenders also get a $0.45 tax deduction for blending.

Very difficult to measure but ethanol has extended national gasoline supplies by 9%, so laws of supply/demand should result in lower gasoline prices, saving consumers money at the pump.
Old 10-20-2010, 09:27 AM
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The answers to your questions are significant and very hard to actually "pin down" but it's hitting us in our wallets in in virtually everything we consume.

When one looks beyond the surface of the official propaganda of the lobbyists, corn ethanol’s record is not so clear (see The True Cost of Corn Ethanol). More than $40B worth of subsidies has been provided to prop up the industry with questionable -- at best -- environmental and economic benefits. The amount of energy (and CO2e) involved with growing, harvesting and transporting corn to a mill where it is grounded, slurried, fermented, and distilled is intensive.

The resulting ethanol then needs to be transported either by truck, rail, or barge to a fuel station given that most petroleum pipelines cannot transport ethanol due to its miscibility with water.

This energy calculation does not even account for “direct” or “indirect land use” changes that occur as carbon-rich peat forests are cleared in countries like Indonesia, Malaysia, and Brazil to grow corn for human consumption that would otherwise be grown in the United States but is diverted for ethanol.

Economically, it is unclear whether the industry can survive without billions of dollars in corporate welfare in the form of generous production quotas, tax credits, and import tariffs that largely insulate the corn ethanol industry from Brazilian competition.

And while corn ethanol’s displacement of 6.1% of U.S. gasoline consumption is significant, coming at the expense of one-third of the world’s largest corn crop at a time when one billion people are chronically hungry seems like corn ethanol will only prove more controversial if it consumed at the scale that Big Agriculture would like to see.

A new study by University of Missouri Food and Agricultural Policy Research Institute (PDF) reveals that the current corn ethanol tax credit is effectively costing tax payers $4.18 per gallon and is driving up grain prices. The study estimates that the tax credit, which would cost about $5.85 billion next year if extended, will lead to 1.4 billion gallons above the 12.6 billion gallons required by law through the Renewable Fuel Standard (see page 64).

In other words, next year the oil companies will be required to buy 12.6 billion gallons of conventional corn ethanol, but because tax payers are giving them $5.85 billion they'll consume
1.4 billion more than required. That works out to $4.18 per extra gallon.

Taxpayers have been subsidizing the corn ethanol industry far too long at the expense of developing cleaner, more renewable biofuels.

Plus the FAPRI study also points out that the tax credit is leading to higher prices for corn and other grains--$0.18 per bushel of corn, $0.28 for soy, and $0.15 for wheat. (Probably obsolete figures at today’s commodity’s market) And lest anyone argue that the tax credit is a good way of supporting farmer income, think about this: if we gave farmers an extra $0.15, $0.28, and $015 per bushel for every single one of the corn, soy, and wheat bushels they'll grow next year, it would cost just $3.56 billion. And we'd still have enough of the tax credit money left over to subsidies the extra 1.4 billion gallons to the tune of $1.64.

Yesterday, Growth Energy had the audacity to argue that the tax credit lowers the price of gasoline. It's a cynical, shell-game claim, meant to earn support from drivers who are actually subsidizing this well established industry every April 15.

The simple fact of the matter is the current corn ethanol tax credit is a huge waste of money. We don't need an additional 1.4 billion gallons of corn ethanol, or the higher prices for grains and more deforestation that come with it. And we sure as heck don't need to be spending $4.18 per gallon to get it. The corn ethanol tax credit (and the biodiesel tax credit too) needs to end!

At taxpayer expense.

Congress, anxious to do something, anything, about the price of gasoline, has given the agribusiness industry a mandate it cannot refuse. Corn ethanol production must rise from 4.0 billion gallons in 2006 to 7.5 billion gallons by 2012. Anxious to make sure its corn ethanol mandate gets done, Congress has also decided to take our tax money and use it to subsidize the production of ethanol. The current ethanol subsidy is a flat 51 cents per gallon of ethanol paid to the agent (usually an oil company) that blends ethanol with gasoline. Some States add other incentives, all paid by the taxpayer.

But there is more. It costs money to store, transport and blend ethanol with gasoline. Since ethanol absorbs water, and water is corrosive to pipeline components, it must be transported by tanker to the distribution point where it is blended with gasoline for delivery to your gas station. That’s expensive transportation. It costs more to make a gasoline that can be blended with ethanol. Ethanol is lost through vaporization and contamination during this process.

Gasoline/ethanol fuel blends that have been contaminated with water degrade the efficiency of combustion. E-85 ethanol is corrosive to the seals and fuel systems of most of our existing engines (including boats, generators, lawn mowers, hand power tools, etc.), and cannot be dispensed through existing gas station pumps. And finally, ethanol has about 30 percent less energy per gallon than gasoline. That means the fuel economy of a vehicle running on E-85 will be about 25% less than a comparable vehicle running on gasoline.
Old 10-20-2010, 09:42 AM
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Not to mention all of the heavy use of fertilizers and insecticides that are required to plant more acreage. All of the added chemicals end up in our water systems.
Old 10-20-2010, 09:53 AM
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I think it is fairly well proven that the use of Ethanol as any type reduction in oil usage is just hocus pocus bull. Harvesting, producing and shipping it just negates any gains or positives it might have. The govt bucks is all that is keeping this white elephant afloat...

I think the serious future contender is making fuel from algae
Old 10-20-2010, 10:05 AM
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Originally Posted by Bamby View Post
The answers to your questions are significant and very hard to actually "pin down" but it's hitting us in our wallets in in virtually everything we consume.

When one looks beyond the surface of the official propaganda of the lobbyists, corn ethanol’s record is not so clear (see The True Cost of Corn Ethanol). More than $40B worth of subsidies has been provided to prop up the industry with questionable -- at best -- environmental and economic benefits. The amount of energy (and CO2e) involved with growing, harvesting and transporting corn to a mill where it is grounded, slurried, fermented, and distilled is intensive.

The resulting ethanol then needs to be transported either by truck, rail, or barge to a fuel station given that most petroleum pipelines cannot transport ethanol due to its miscibility with water.

This energy calculation does not even account for “direct” or “indirect land use” changes that occur as carbon-rich peat forests are cleared in countries like Indonesia, Malaysia, and Brazil to grow corn for human consumption that would otherwise be grown in the United States but is diverted for ethanol.

Economically, it is unclear whether the industry can survive without billions of dollars in corporate welfare in the form of generous production quotas, tax credits, and import tariffs that largely insulate the corn ethanol industry from Brazilian competition.

And while corn ethanol’s displacement of 6.1% of U.S. gasoline consumption is significant, coming at the expense of one-third of the world’s largest corn crop at a time when one billion people are chronically hungry seems like corn ethanol will only prove more controversial if it consumed at the scale that Big Agriculture would like to see.

A new study by University of Missouri Food and Agricultural Policy Research Institute (PDF) reveals that the current corn ethanol tax credit is effectively costing tax payers $4.18 per gallon and is driving up grain prices. The study estimates that the tax credit, which would cost about $5.85 billion next year if extended, will lead to 1.4 billion gallons above the 12.6 billion gallons required by law through the Renewable Fuel Standard (see page 64).

In other words, next year the oil companies will be required to buy 12.6 billion gallons of conventional corn ethanol, but because tax payers are giving them $5.85 billion they'll consume
1.4 billion more than required. That works out to $4.18 per extra gallon.

Taxpayers have been subsidizing the corn ethanol industry far too long at the expense of developing cleaner, more renewable biofuels.

Plus the FAPRI study also points out that the tax credit is leading to higher prices for corn and other grains--$0.18 per bushel of corn, $0.28 for soy, and $0.15 for wheat. (Probably obsolete figures at today’s commodity’s market) And lest anyone argue that the tax credit is a good way of supporting farmer income, think about this: if we gave farmers an extra $0.15, $0.28, and $015 per bushel for every single one of the corn, soy, and wheat bushels they'll grow next year, it would cost just $3.56 billion. And we'd still have enough of the tax credit money left over to subsidies the extra 1.4 billion gallons to the tune of $1.64.

Yesterday, Growth Energy had the audacity to argue that the tax credit lowers the price of gasoline. It's a cynical, shell-game claim, meant to earn support from drivers who are actually subsidizing this well established industry every April 15.

The simple fact of the matter is the current corn ethanol tax credit is a huge waste of money. We don't need an additional 1.4 billion gallons of corn ethanol, or the higher prices for grains and more deforestation that come with it. And we sure as heck don't need to be spending $4.18 per gallon to get it. The corn ethanol tax credit (and the biodiesel tax credit too) needs to end!

At taxpayer expense.

Congress, anxious to do something, anything, about the price of gasoline, has given the agribusiness industry a mandate it cannot refuse. Corn ethanol production must rise from 4.0 billion gallons in 2006 to 7.5 billion gallons by 2012. Anxious to make sure its corn ethanol mandate gets done, Congress has also decided to take our tax money and use it to subsidize the production of ethanol. The current ethanol subsidy is a flat 51 cents per gallon of ethanol paid to the agent (usually an oil company) that blends ethanol with gasoline. Some States add other incentives, all paid by the taxpayer.

But there is more. It costs money to store, transport and blend ethanol with gasoline. Since ethanol absorbs water, and water is corrosive to pipeline components, it must be transported by tanker to the distribution point where it is blended with gasoline for delivery to your gas station. That’s expensive transportation. It costs more to make a gasoline that can be blended with ethanol. Ethanol is lost through vaporization and contamination during this process.

Gasoline/ethanol fuel blends that have been contaminated with water degrade the efficiency of combustion. E-85 ethanol is corrosive to the seals and fuel systems of most of our existing engines (including boats, generators, lawn mowers, hand power tools, etc.), and cannot be dispensed through existing gas station pumps. And finally, ethanol has about 30 percent less energy per gallon than gasoline. That means the fuel economy of a vehicle running on E-85 will be about 25% less than a comparable vehicle running on gasoline.
Deforestation is not really an issue in the US and Canada as we have bumped crop yields per acre to such high levels that a lot of land has been left fallow and there has even been talk about replanting some of it in the Great Plains region with tall prairie grasses. As for Brazil, they have been moving over to sugar cane based ethanol. Perhaps the only good thing you can say about sugar cane is while it is not exactly an environmentally friendly crop, it it is grown and harvested in the same way for ethanol production as it is for sugar/molasses, then the burning of he fields creates the "muck" soil which says that maybe you can use the existing land for a longer period of time than with other crops. The big problem in Brazil and places like it is that rainforest soil is SO poor (think very wet desert) , you play it out in a couple of seasons and have to clear cut more forest. Pretty much all of the nutrients in the soil come from the initial burning. At least with sugar cane, you burn part of the crop and not the trees. The down side, as we have discovered in the US, is that harveting cane is very labor intensive, not to mention failry dangerous and can only be done economically where you have REALLY cheap labor. I'm not sure who does the work now, but at he time that I moved away from Miami in 1988, all of the sugar cane harvesting in South Florida was being done by migrant workers from the Caribbean even with the outrageous subsidies that US sugar growers receive.
With that said, I'm not even sure that cellulitic ethanol is the ultimate solution as that only reduces the initial amount of plant material that you have to grow. You still start the fementation/distillation process with the same volume of mash and have the outrageously high energy budget for distilling he stuff even of you are using prairie grass as the "feedstock". You also have to retain the separate transportation infrastructure to move the ethanol.
I would be interested to see a production/energy cost comparison between ethanol and other non-traditional sources fuel like the oil shale/tar sands we have in North America, liquid fuel made from natural gas like Boone Pickens was talking about or the "heavy" oil deposits like you see in massive quantities in places like the Orinoco Basin of Venezuela.
Old 10-20-2010, 10:56 AM
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As far as Shale oil, here in US we have enough of that to sustain us for a very long time. From my understanding at around the 2.50 to 3.00 a gallon for gas it is a sustainable and economically viable resource for making gas with profits to be made...
Old 10-20-2010, 02:10 PM
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We, I mean in as humans need to phase in a sustainable energy source that is compatible with the rhythms of nature. Though ethanol is currently utilized in our energy consumption, in America at least we have very few engines designed from the ground up to be actually compatible with it.

Then if ethanol is going to be the fuel of choice why was corn chosen as the base for it to be made from? Also important is the amount of energy used to produce ethanol. Growing, transporting, and distilling corn to make a gallon of ethanol uses almost as much energy as is contained in the ethanol itself. Sugar beets are a better source, producing nearly two units of energy for every unit used in production.

This Hawaiian sugar cane can be used to produce ethanol. Sugarcane, though, is by far the most efficient of the current feedstock’s yielding eight times as much energy as is needed to produce the ethanol. Given their positive energy balances and higher yields, it makes more sense to produce ethanol from sugar crops than from grains.

Ethanol could quickly take off in sugarcane-producing tropical countries,which have the
advantage of year-round growing seasons, large labor supplies, and low production costs. As fuel demand rises in these developing nations, biofuel production could check oil imports while bolstering rural economies.

Then maybe there is some real potential in this: http://www.silverbearcafe.com/privat...0/plastic.html

The machine produced in various sizes, for both industrial and home uses, can easily transform a kilogram of plastic waste into a liter of oil, using about 1 kilowatt of electricity but without emitting CO2 in the process. The machine uses a temperature controlling electric heater instead of flames, processing anything from polyethylene or polystyrene to polypropylene (numbers 2-4). Comment: 1 kg of plastic produces one liter of oil. This takes about 1 kilowatt of electricity, which costs 20 cents. 1 liter diesel oil costs $1.50 (this could be somewhat dated)

Will it work is there real potential in meeting at least some of our energy means from plastics? We’re throwing it away as waste in our landfills and oceans every day wouldn’t it be a blessing to utilize it for something purposeful and useful again.

Many think that this type of recycling is not a solution, but that instead the world should be seriously focused on the first “R” — which is reduce. We should shun single-use plastic (such as your average PET bottle or disposable container) altogether, they argue. The world’s oil resources are diminishing; does technology like this enable our denial of that fact, or is it a hopeful and constructive step in the right direction?

Others have concerns about pollution or toxic residue from the conversion process. Blest tells us that, if the proper materials are fed into the machine (i.e., polyethylene, polystyrene and polypropylene — PP, PE, PS plastics), there is no toxic substance produced and any residue can be disposed of with regular burnable garbage. They also explain that while methane, ethane, propane and butane gasses are released in the process, the machine is equipped with an off-gas filter that disintegrates these gases into water and carbon.

I was a gas station attendant when un-leaded fuel was introduced and forced upon us. Everyone then had the same issues about the new fuel as we’re experiencing now with ethanol. But the biggest difference then compared to now is how the introduction took place. Un-leaded was phased into production with the newest fleet of automobiles. Leaded fuel was still readily available for the older vehicles for actual years at the pumps, and even when it was finally phased out completely low cost suitable lead replacement additives were available so folks could continue using their vehicles and equipment till it was actually wore out or needed a complete overhaul.

That’s where I have a problem with where they’re going with the ethanol issue. I’ve got a lot of perfectly good serviceable older (30 years or more) equipment that’s bought and paid for, that’s actually better stuff than any new equipment that I could purchase to replace it with. With proper care some or all of my gas fuel equipment could or likely would outlast me. I’m having a personal issue dealing with the expensive unserviceable junk being sold today, and I’d like the opportunity to completely utilize what I already own.
Old 10-21-2010, 01:51 PM
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Originally Posted by Bamby View Post
We, I mean in as humans need to phase in a sustainable energy source that is compatible with the rhythms of nature. Though ethanol is currently utilized in our energy consumption, in America at least we have very few engines designed from the ground up to be actually compatible with it.

Then if ethanol is going to be the fuel of choice why was corn chosen as the base for it to be made from? Also important is the amount of energy used to produce ethanol. Growing, transporting, and distilling corn to make a gallon of ethanol uses almost as much energy as is contained in the ethanol itself. Sugar beets are a better source, producing nearly two units of energy for every unit used in production.

This Hawaiian sugar cane can be used to produce ethanol. Sugarcane, though, is by far the most efficient of the current feedstock’s yielding eight times as much energy as is needed to produce the ethanol. Given their positive energy balances and higher yields, it makes more sense to produce ethanol from sugar crops than from grains.

Ethanol could quickly take off in sugarcane-producing tropical countries,which have the
advantage of year-round growing seasons, large labor supplies, and low production costs. As fuel demand rises in these developing nations, biofuel production could check oil imports while bolstering rural economies.

Then maybe there is some real potential in this: http://www.silverbearcafe.com/privat...0/plastic.html

The machine produced in various sizes, for both industrial and home uses, can easily transform a kilogram of plastic waste into a liter of oil, using about 1 kilowatt of electricity but without emitting CO2 in the process. The machine uses a temperature controlling electric heater instead of flames, processing anything from polyethylene or polystyrene to polypropylene (numbers 2-4). Comment: 1 kg of plastic produces one liter of oil. This takes about 1 kilowatt of electricity, which costs 20 cents. 1 liter diesel oil costs $1.50 (this could be somewhat dated)

Will it work is there real potential in meeting at least some of our energy means from plastics? We’re throwing it away as waste in our landfills and oceans every day wouldn’t it be a blessing to utilize it for something purposeful and useful again.

Many think that this type of recycling is not a solution, but that instead the world should be seriously focused on the first “R” — which is reduce. We should shun single-use plastic (such as your average PET bottle or disposable container) altogether, they argue. The world’s oil resources are diminishing; does technology like this enable our denial of that fact, or is it a hopeful and constructive step in the right direction?

Others have concerns about pollution or toxic residue from the conversion process. Blest tells us that, if the proper materials are fed into the machine (i.e., polyethylene, polystyrene and polypropylene — PP, PE, PS plastics), there is no toxic substance produced and any residue can be disposed of with regular burnable garbage. They also explain that while methane, ethane, propane and butane gasses are released in the process, the machine is equipped with an off-gas filter that disintegrates these gases into water and carbon.

I was a gas station attendant when un-leaded fuel was introduced and forced upon us. Everyone then had the same issues about the new fuel as we’re experiencing now with ethanol. But the biggest difference then compared to now is how the introduction took place. Un-leaded was phased into production with the newest fleet of automobiles. Leaded fuel was still readily available for the older vehicles for actual years at the pumps, and even when it was finally phased out completely low cost suitable lead replacement additives were available so folks could continue using their vehicles and equipment till it was actually wore out or needed a complete overhaul.

That’s where I have a problem with where they’re going with the ethanol issue. I’ve got a lot of perfectly good serviceable older (30 years or more) equipment that’s bought and paid for, that’s actually better stuff than any new equipment that I could purchase to replace it with. With proper care some or all of my gas fuel equipment could or likely would outlast me. I’m having a personal issue dealing with the expensive unserviceable junk being sold today, and I’d like the opportunity to completely utilize what I already own.
Actually, corn ethanol requires about 70% more energy to produce than it contains. The issue is nto so much the amount of biomass that you have to use to produce the mash, but the fact that you have to boil at least 100 gallons of mash to produce say 10-15 gallons of ethanol. You also have to first make the "impure" alcohol though fermentation before you can distill it out. In the case of biodiesel made from any kind of fat, you merely have to scrub out the water, glycerin and other impurities and in the case of oil, all you are doing is separating out the various component parts of the crude oil. If you want to know how economical ethanol is, think about what a liter of the cheapest, nastiest vodka you can buy costs, multiply that first by 2.4 to get it from 40% to 100% ethanol and then multiply by almost 4 to figre out what a gallon would cost. Asfor other "food based" fuels, go price a gallon of the cheapest store brand cooking oil that you can find and you will knowhow much your biodisel will cost to make. The 90 cents for a gallon of biodiesel only applies if you can get free waste cooking oil and nobody is giving that stuff away anymore. As for your plastic fantastic machine, one liter of diesel cost around 75 to 80 cents in Florida right now and as with biodiesel, the assumption is that you will have a free or cheap source of plastic that nobody else will want to use for things like recycling it into more plastic. Great for the survivalist with an old VW Golf diesel who likes to collect soda bottles on the side of the road, but not for commercial use.

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