The Sin of Corn-Based Ethanol
A reporter at Dow Jones Marketwatch just asked me: "Just the short answer to the question please: Since it takes a lot of energy and corn to make ethanol, does the effort to produce it outweigh benefits of the finished product?"
Here is my answer:
Let me give you an answer that is not a short answer. I have to tell you about something called EROEI, or EROI, or Energy Return on Energy Invested. Basically, it’s Energy Output/Energy Input. And it is at the crux of why corn-based ethanol is a boondoggle. EROI can also be expressed as “net energy,” in other words, if you put 1 BTU (British Thermal Unit) making something, and you get 1.2 BTUs as an end product, your EROI is 1.2:1 and your net energy is 0.2.
0.2 sounds small. It is. And that’s the net energy of corn-based ethanol. At EROI of 1.2 to 1, the 3.9 billion gallons that the US produced in 2005 required 3.29 billion gallons of BTU energy input, resulting in a `net energy' of 610 million gallons.
And remember, this is being generous. There are some computations that show corn-based ethanol has a net energy of zero. Others show it as a net energy LOSER.
Meanwhile, all that corn that was used to make ethanol could NOT be sold for food. So, your food prices are higher.
How does corn-based ethanol compared to oil when it comes to EROI? When oil was cheap and fresh and literally gushed out of wells, the EROI on oil was about 100 to 1. That’s right, 100 to 1. Even nowadays, when we’re drilling for more expensive oil, the EROI for oil is about 10:1 or 15:1.
So why would anybody bother with corn-based ethanol? The answer is simple: Money! Agriculture giants like ADM and the big corporate farms are making money with both hands. On the one hand, they make money from tax subsidies for ethanol production. On the other hand, they make money from selling corn as food because corn is more scarce, so the price of it goes higher.
I not only think corn-based ethanol is a bad business idea. I think it’s a sin.
That said, the technology could improve. If scientists figure a way to improve the EROI of corn-based ethanol, it might be worth it.
Here is my answer:
Let me give you an answer that is not a short answer. I have to tell you about something called EROEI, or EROI, or Energy Return on Energy Invested. Basically, it’s Energy Output/Energy Input. And it is at the crux of why corn-based ethanol is a boondoggle. EROI can also be expressed as “net energy,” in other words, if you put 1 BTU (British Thermal Unit) making something, and you get 1.2 BTUs as an end product, your EROI is 1.2:1 and your net energy is 0.2.
0.2 sounds small. It is. And that’s the net energy of corn-based ethanol. At EROI of 1.2 to 1, the 3.9 billion gallons that the US produced in 2005 required 3.29 billion gallons of BTU energy input, resulting in a `net energy' of 610 million gallons.
And remember, this is being generous. There are some computations that show corn-based ethanol has a net energy of zero. Others show it as a net energy LOSER.
Meanwhile, all that corn that was used to make ethanol could NOT be sold for food. So, your food prices are higher.
How does corn-based ethanol compared to oil when it comes to EROI? When oil was cheap and fresh and literally gushed out of wells, the EROI on oil was about 100 to 1. That’s right, 100 to 1. Even nowadays, when we’re drilling for more expensive oil, the EROI for oil is about 10:1 or 15:1.
So why would anybody bother with corn-based ethanol? The answer is simple: Money! Agriculture giants like ADM and the big corporate farms are making money with both hands. On the one hand, they make money from tax subsidies for ethanol production. On the other hand, they make money from selling corn as food because corn is more scarce, so the price of it goes higher.
I not only think corn-based ethanol is a bad business idea. I think it’s a sin.
That said, the technology could improve. If scientists figure a way to improve the EROI of corn-based ethanol, it might be worth it.
Check out my new gold and energy blog at MoneyAndMarkets.com
posted by Sean Brodrick @ 12:45 PM
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