Tuesday, June 10th, 2008

Having written extensively about the potential downsides of biofuels, we wanted to highlight an announcement by U.S. Agriculture Secretary Ed Schafer, asserting that ethanol is not having a “major” impact on the rapid increase in world food prices. According to the USDA, policies encouraging biofuel use account for only 3% of the more than 40% increase in world food prices last year. The rest of the increase in prices was attributed to things such as widespread drought, an increase in global food demand from booming populations, and high energy costs.
Whether the USDA’s numbers are accurate or not, apparently their analysis was limited to the price of food and did not address the claim that biofuel production and use may actually release more greenhouse gasses than gasoline. Nonetheless, if their analysis is accurate, it does seem to lessen one major argument against increased biofuel development.
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Tuesday, May 6th, 2008

Last week GM announced that they were investing in a second company that develops technology for ethanol production. Apparently this is an attempt by GM to hedge its bets on how to most efficiently produce non-grain based ethanol. This type of biofuel, known as cellulose, requires a complicated final process to convert the material’s sugar into alcohol, which can be burned by engines. The company that GM invested in uses a process different than that which GM has previously pursued. This alternative process requires no use of chemicals, and instead relies on heat and mechanical action to convert the material to alcohol.
It is unclear to us whether this process releases fewer greenhouse gasses during the manufacturing process, an issue which has been of great concern lately. While it is encouraging to see GM invest in a technology that is forward thinking, it is unclear whether this process will ultimately help the environment, or if it is instead, an attempt to fulfill the mandates of the federal government on biofuel usage. [Note, this link is to an organization that “speaks for the petrochemical and refining industries on issues important to their business.”]
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Thursday, April 3rd, 2008

An op-ed at SFGate.com looked at a topic we’ve touched on a few times here—whether ethanol production is reducing or exacerbating the problem of greenhouse gas emissions. We’re interested by this topic because it deals with the potential dangers of reflexive governmental mandates. Whether ethanol is actually worse for the environment than petroleum, we’re not sure, but this opinion piece does a nice job of identifying the major criticisms of biofuels and their negative effects on the environment and society in general.
Those criticisms are as follows:
-Increased demand for corn (and other biofuel crops) causes the price of those crops, and consequently food, to increase.
-Increased crop prices make it more expensive for farmers to feed their livestock, thereby increasing the price of meat and dairy products.
-Biofuel production requires extreme amounts of water—in fact, one gallon of ethanol requires four gallons of water to produce.
-The increased demand for biofuel crops leads to deforestation and destruction of wetlands and grasslands, to make space for the planting of those crops. Both the process of clearing these lands, as well as the loss of their carbon consuming foliage, lead to increased greenhouse gasses in the atmosphere.
And towards the end of the op-ed piece, the author basically throws in the kitchen sink, with the following paragraph:
Scientists predict that the Gulf of Mexico, already polluted by agricultural runoff from the United States, will only get worse as demand for ethanol, and therefore corn, increases. Meanwhile, rain forests throughout Central and South America are being razed to make way for land to grow biofuel components. Tortilla shortages in Mexico, rising flour prices in Pakistan, Indonesian and Malaysian forests being cut down and burned to make palm oil, and encroachments upon the Amazon rainforest due to Brazilian sugar cane production — all these developments indicate that biofuels are turning out to be more destructive than helpful.
While complete scientific consensus has not yet been reached on this topic, these arguments that biofuels are a bad thing for the planet sure seem compelling as more information about their consequences comes to light.
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Tuesday, March 25th, 2008

Environmental Capital, at WSJ.com, looked at a subject we have discussed regularly here—which is: are biofuels a part of the solution, or an unintended exacerbation of the problem of global warming?
As we’ve noted previously, some recent studies indicate that biofuels, such as ethanol, may actually be worse for the environment than the fossil fuels they replace. In our discussions, we’ve usually limited our analysis to which option releases more aggregate CO2 into the atmosphere. However, the Environmental Capital post notes that some experts believe that biofuel production has resulted in a 15% decrease in oil prices. Therefore, if recent policies by developed nations to increase biofuel usage are reversed, would that result in a subsequent 15% increase in oil prices?
We find this question interesting because it presents two options that are not normally pitted against each other in such a manner. If biofuel is worse for the environment than petroleum, but its production results in more affordable oil, will we find ourselves “addicted to corn?”
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Tuesday, March 18th, 2008

We had a post recently about whether Virgin Atlantic’s green programs were a true attempt at improving the environment or if they were mere greenwashing. While we didn’t have a strong opinion, we tended to feel that they were probably a mixture of both.
Therefore, we were interested to come across this article describing how Virgin Atlantic recently had a test flight of a 747 from London to Amsterdam, where the plane carried 5% biofuel derived from coconuts. Given the publicity and grandiose nature of this test flight, and the fact that biofuels may cause more environmental damage than the fossil fuels they replace, we question whether the intention here is merely positive marketing, instead of substantive change?
Nonetheless, as our readers have probably noticed, we are hesitant to throw out the “greenwashing” accusation too quickly. No one knows for sure what the best solution will be, and little has been done in the past, so even getting corporations just talking about going green has some value. Of course, policies that materially improve the environment should be the real goal. (Which probably does not include a 747 flying with 5% coconut fuel.)
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