Richard Nixon had an enemies list. And now, so, too, do the corn ethanol scammers.
Last week, Tom Waterman, the editor and publisher of The Ethanol Monitor, published a list of the top ten enemies of ethanol. Here’s the list:
#10: Business Week/Ed Wallace (Bloomberg)
#8: “Big Oil”
#7: Grocery Manufacturers Association
#6: David Pimentel
#5: Robert Rapier
#4: Tim Searchinger
#3: Wall Street Journal (editorial board)
#2: California Air Resources Board
#1: Time Magazine (Michael Grunwald)
Of course, Waterman can write whatever he likes, but the fact that the ethanol boosters would produce a list of enemies is indicative of just how paranoid the ethanol scammers are getting. And their nuttiness appears to be rising along with their efforts to vacuum up yet more taxpayer subsidies in the wake of the BP blowout.
Indeed, the timing of Waterman’s story is remarkable. It is being published at the same time that the ethanol industry’s lobby groups, including the Renewable Fuels Association and Growth Energy, are trying to capitalize on the blowout in the Gulf in order to garner yet more taxpayer subsidies for their scam. In addition, Waterman’s enemies list was published on Friday, just four days before the Environmental Working Group came out with a report which shows that between 2005 and 2009, the corn ethanol scammers collected $17 billion in subsidies from US taxpayers. Finally, Waterman’s list appears at about the same time that three academics at the Georgia Institute of Technology have come out with a paper which shows, once again, that the corn ethanol industry’s hunger for grain is competing with food.
So why does the corn ethanol scam need more subsidies? In industry parlance, it is facing a head-on collision with the "blend wall." Ethanol producers depend on gasoline sales because their product must be mixed with conventional fuel. But thanks to the recession and the end of Americans’ love affair with large SUVs, U.S. gasoline demand is flat or declining. That has left a smaller pool of gasoline to absorb all the alcohol the ethanol industry is producing. Or as Bob Dinneen, the president of the Renewable Fuels Association, has put it, “we have lots of gallons of ethanol chasing too few gallons of gasoline.”
And unfortunately, the Obama administration appears ready and willing to foist yet more of the corrosive, environmentally destructive, low-heat-energy fuel on motorists. On April 28, six days after the Deepwater Horizon rig sank, President Obama visited an ethanol plant in Missouri and declared that “there shouldn’t be any doubt that renewable, homegrown fuels are a key part of our strategy for a clean-energy future.” He went on, saying “I didn’t just discover the merits of biofuels like ethanol when I first hopped on the campaign bus.”
The strongest indication that an ethanol bailout is imminent came last Friday when Agriculture Secretary Tom Vilsack (former governor of Iowa, the nation’s biggest ethanol-producing state) said, “I’m very confident that we’re going to see an increase in the blend rate.”
The “blend rate” refers to the federal rule that limits ethanol blends to no more than 10 percent for standard automobiles. Commonly known as “E10,” the fuel contains 90 percent gasoline and 10 percent alcohol. The Obama administration bailout, which would come via approval from the EPA, will likely allow gasoline retailers to blend up to 15 percent ethanol into U.S. gasoline supplies.
And that’s where the corn ethanol mess becomes truly outrageous and depressing. The U.S. now has about 250 million motor vehicles. Of that number, only about 7.5 million are designed to burn gasoline containing more than 10 percent ethanol. And there is evidence that even that even 10 percent ethanol may be too much for the other 242.5 million. Last year, Toyota recalled more than 200,00 Lexus vehicles because of internal component corrosion that was caused by ethanol-blended fuel.
In addition to problems with their cars, consumers may soon find that more ethanol in their gasoline will result in the fouling of smaller engines. The Outdoor Power Equipment Institute, which represents companies that make lawnmowers, snowblowers, chainsaws and the like, opposes the bailout of the ethanol industry. It says that increasing the amount of ethanol in gasoline “could damage millions of forestry, lawn and garden, and other small engine products currently housed in consumers’ garages.”
But that’s only part of the ethanol rip-off. According to the new report from the Environmental Working Group, the $17 billion in ethanol subsidies from taxpayers over the past five years has largely been wasted.
In terms of reducing consumption of fossil fuels in the transportation sector, including the fuel needed to produce ethanol and transport it to the market, the payoff is downright dismal. Less than half-of-a-mile-per-gallon increase in fleet-wide fuel economy would yield the same reduction in fossil fuel use as all 10.6 billion gallons of corn ethanol added to gasoline in 2009.
Finally, there’s the new report from Georgia Tech, written by Kobi Abayomi and two others, which adds yet more evidence to the food-versus-fuel debate. Abayomi and his co-authors found that as ethanol production increases, there is “strong evidence of competition among corn based outputs -- corn for food, feed stocks, and export -- and ethanol production.”
The report from Georgia Tech is one of at least 16 studies that have found a link between food prices and the corn ethanol madness.
But back to the ethanol enemies list: I contacted Tim Searchinger, who made number 4 on the list for a reaction. (I interviewed Searchinger, a visiting research scholar at the Woodrow Wilson School at Princeton, in 2008 for ET.) When told he had made the ethanol industry’s enemies list, he laughed for a long while, and then said, “no comment.”
Robert Rapier, a chemical engineer and blogger who we’ve published many times here on ET, responded in a piece published last night about his making the top ten thusly: “I am not an enemy of corn ethanol at all. But I am an enemy of misinformation. And given the often close ties between the two, I can hardly blame someone for failing to distinguish the difference.”
As for me, I was given an “honorable mention” on the enemies list. (As was Tad Patzek, the head of the petroleum engineering department at the University of Texas.) That’s somewhat disappointing to me, but Waterman did allow that I “just missed the Top Ten.” I called Waterman yesterday to ask him about his enemies list. He did not respond. If/when he does, I will write about our conversation.
By. Robert Bryce