Mary Clare Jalonick’s feature article on ethanol asks: “Is corn-based ethanol fuel the wave of the future, creating domestic jobs and vital to the nation’s energy supply? Or is it a taxpayer boondoggle responsible for higher food prices?” Executive summary: The former in the short term, kinda, and the latter in the long term, definitely.
A short while ago, Adam wrote a paper on the subject that helped me reach a conclusion on ethanol. He proposed that it and other food-based biofuels would best serve as the transitional stage between fossil fuels and more modern forms of alternative energy. Of course, it will take a long time before the whole of American manufacturing and transportation is able to adapt to said modern forms; my completely unscientific estimate is between 25 and 30 years.
This is where ethanol comes in. Everyone understands the importance of reducing dependence on fossil fuels. Whether or not it has any impact whatsoever on the environment, there is a limited supply available to the entire planet, and definitely a limited supply available to Americans without going through international trade channels. “Anything else we can run the car on so we can stop needing the Arabs? Corn? Yeah, let’s do it!”
Then food prices went up, as is typical when a commodity supply dwindles, and everyone got an easy target. Like everything else, the ethanol industry has an ethanol lobby to go with it, whose job it is now to inform everyone that a) food prices aren’t going up just because of them and b) it’s worth it in any case. However, a World Bank report from 2008 attributed 75% of the rise to first-generation, food-based biofuels. That’s a tough act to follow for the ethanol lobby.
Regretfully, no one can simply snap their fingers at the ethanol lobby and tell them to get started on non-food biofuels (including ones derived from corn stalks, algae, and cellulose), which are more difficult to grow, extract, and convert. But now would be a good time to get started. Not only would it increase their credibility to Washington, but it would provide an extra energy and research investment opportunity and serve as yet another transitional stage en route to Ed Begley, Jr.-style alternative energy.
The current ethanol industry will likely enjoy another decade of steady purchasing, but it should nonetheless prepare to convert itself into a cleaner, more modern, more efficient industry. Soon, ethanol will have reached its peak and they’ll feel the pinch to conserve and adapt to world demand.