I don’t mind policy that gets us somewhere. I do mind when political and corporate leaders treat us like we just fell off the pickle truck.
I’m in favor of farmers being able to make a buck. They will get that buck out of my pocket at some level anyway. Subsidies, Disaster Payments, Tax Breaks.
What I resent is when I am expected to believe in a fairy tale and be happy about it. First, I am convinced beyond all reasonable doubt that the production of ethanol for fuel is less than a zero sum game. It takes more energy to produce a like unit of ethanol energy from corn. So, we burn diesel imported from the Middle East and natural gas from Canada to produce a fuel we claim is homegrown. And it costs more to produce in units of energy than it produces. You can do your own research.
Now, that’s pretty harmless. I mean it’s better than just sending mailbox money to buy a new pickup truck for Jr. The farmer has to do actual work to participate in this subsidy. It provides jobs. The ethanol plant hires people. Money flows. Land rents are paid. It’s all good.
The other part of this scam is that burning ethanol in your fuel has equivalency to gasoline. I’m still not just off the pickle truck.
Last week I was in ethanol country. I put on 2300 miles. All flat land interstate driving, all at 75 miles per hour thru Nebraska, South Dakota, North Dakota and Minnesota. The old Buick has a fancy gas mileage computer on it. I reset it after straight and level and after differing fuel formulations. Driving at least a hundred miles straight after each fill. Here are the results:
10% Gasahol 25 MPG ($2.55/gal)
50% Gasahol (half 10% and half E-85) 22 MPG ($2.55 + 1.97/gal)
85% Ethanol Gasoline Mix (E-85) 19 MPG ($1.97/gal)
Pure Gasoline 87 Octane 28MPG ($2.61/gal)
Premium 92 Octane 31MPG ($2.82/gal)
So with that methodology, does burning E-85 make sense? I don’t think so. In fact you get what you pay for. Maybe around town it’s ok. But it’s a false economy. Based on this study I am going to start burning premium on longer trips. It’s the cheapest gasoline I can burn. More btu’s per gallon. And in the long run that’s what you pay for.
I love our President Bush. He’s a wonderful guy with really poor advisors. He has just signed an energy bill to push ethanol percentages in gasoline from 10% to 20% to reduce our dependence on foreign oil. It’s really just a farm program.
And my friends you will get poorer mileage for more money.
But until we discover the true production oil substitute crop we will dink around with this.
Pity. Make work policies always flow from the government.
2 comments:
I've followed this "gasahol" scam for a good many years now. When I was a little newsman in Blackfoot Idaho I don't know how many "gasahol" plants I saw built.
A like number were closed with the farmer funding it going broke...
The only ones that seem to benefit are the manufacturers of the equipment...and the builders.
I know that "gasahol" and E-85 are different creatures....but, when it comes to the scam, they're the same animal.
I think.
Gene,
I truly appreciate the data you gathered. This is exactly the type of information I'd hoped for...not from academic sources, but from people in real life. Based on your data, I get:
$0.1037 per mile on the E-85,
$0.1027 per mile on the 1/2 E-85/E-10
$0.102 per mile on the E-10
$0.0932 per mile on the 87 octane gas
$0.0910 per mile on the 92 octane gas
Based on those numbers, the ratio between the E-85 and the 92 octane gas is 0.877, a really significant differential.
Considering that much of the differential in cost is accomplished by tax breaks for ethanol, you have a valid point that ethanol is not a good buy, based on cost per mile per subsidies to ag and the fuel itself.
I would continue with my earlier messages to you that we're in the midst of a war costing (1800+) American lives, Iraqi lives (20,000 to 100,000, depending on your source), Iraqi folks have infrastructure that's less adequate than under Hussein, and the American public is paying $1,000 per man/woman/child per year to subsidize this attempt to control the oil reserves in Iraq. (Oops...almost forgot...our grandchildren and great-grandchildren will pay for this misadventure.)
Well, I'm sure glad we've done such a good job of securing democracy in the Middle East and nailing down so much oil that we can keep prices under control. (Oops...almost forgot...we DO have those prices under control...to the benefit of the Halliburton folks and the Saudi royal family...funny how that works.)
I would submit that 400 billion dollars a year to secure oil supplies is quite a subsidy, indeed.
And, in spite of the cynicism in the above few paragraphs, I truly appreciate the mpg data from your trip. I really helps me to evaluate the facts.
I also enjoyed reading the other diaries on your trip to the upper Midwest and the experience of your CEO friend in ND. Having just returned from my first trip to ND in 15 years (40 year class reunion), I am deeply moved, and sincerely saddened by your observations. I only saw Aberdeen, Sioux Falls and Ellendale/Forbes in the two trips this spring/summer. Aberdeen looks pretty healthy, although they're looking at a Super WalMart arriving soon. In the eyes of the local politico, they fear what happens if they reject Super WalMart and Watertown, Jamestown and Huron have them. It's a sort of "If your friend jumped off the cliff, would you do that, too?"
We live in Michigan, and I don't know about the rest of the world, but if one goes to Sam's or WalMart to buy beef, chicken or pork, the ONLY meat in the case that isn't infused with 10-11% salt/meat tenderizer solution is ground beef. We've quit buying meat there. We stop only occasionally, and only when we haven't been able to find any affordable alternative with a locally owned or operated company.
Example: We used to buy whole pork loins for $1.89 a pound at Sam's or WalMart. Of course, that's with the 10% salt solution added. Since my wife is now on a low-sodium diet, that's not a good alternative. A local supermarket, 10 miles away, that still cuts to order sold me a whole pork loin (sans salt solution) for $2.20 a pound. Given the 10% waste (salt) in the WalMart product and the health benefits for my wife, that's a great deal. All that glitters is not gold, and WalMart/Sam's specializes in applying the glitter.
Blessings Gene,
Terry B.
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