Chicago Daily Herald, IL
05-14-07
Ethanol industry not winning everyone over
By Bob Susnjara
bsusnjara@dailyherald.com
Some of the country's top agriculture professors question the sudden zeal for
ethanol production, saying consumers don't have economic incentive to pay for a
new gasoline blend made mostly from the corn-based fuel.
But there are plenty of defenders of corn-based ethanol, which in many corners
is viewed as a way to reduce U.S. oil consumption. Among them are the
Washington, D.C.-based Renewable Fuels Association and a suburban
congressman who's backing the new fuel called E85.
Gasoline typically contains 10 percent ethanol, but E85 is much different. That
gasoline blend is made from 85 percent ethanol.
What follows are questions about ethanol production and E85, with answers from
skeptics and proponents.
Will the public buy E85?
Skeptic: Roger McEowen, an Iowa State University associate professor of
agricultural law, isn't so sure.
Vehicles lose about 30 percent of fuel economy with E85, said McEowen, so the
fuel must be priced at least that much cheaper than the gasoline blends currently
sold to make it worthwhile to purchase.
"The science of (E85) is debatable," he said during a recent agriculture
conference sponsored by the Chicago Council on Global Affairs.
Proponent: Renewable Fuels Association spokesman Matt Hartwig said
McEowen is wrong about E85.
"That's taking a short-sighted view of the industry," Hartwig said. "The U.S.
ethanol industry might be one of the most progressive in the world."
Hartwig said U.S. manufacturers are working to improve the mileage of flex-fuel
vehicles, which would make E85 more desirable from a financial standpoint.
Are there problems transporting E85?
Skeptic: McEowen said E85 won't catch on in part because it is difficult to store
and corrodes tanks.
Another practical problem with E85 is that it can't be distributed in existing
pipelines across the country, said McEowen.
Proponent: Hartwig said while no pipeline system is in place in the United States
that doesn't mean there are no viable ways to transport E85.
It's more efficient for the ethanol industry to ship the fuel across the country via
railroad, barges and trucks, Hartwig said.
Moreover, he said, critics should take note it's not impossible to ship ethanol
through pipelines because of its corrosive tendencies.
"Tell the Brazilians you can't ship ethanol through a pipeline," Hartwig said.
"They're doing it."
Who is pushing for increased ethanol production?
Skeptic: University of Illinois Professor Robert Thompson, a Gardner chair in
agricultural policy, said politicians seem to be the most interested in pushing
ethanol.
Agriculture industry experts haven't been out front on ethanol like the politicians,
Thompson said.
Proponent: Republican U.S. Rep. Mark Kirk of Highland Park has been one of
the local elected federal officials actively backing ethanol and, in particular, E85.
Last year, Kirk even made an appearance at a Marathon Oil station in Mount
Prospect that sells E85 in an effort to draw attention to the fuel blend.
If it seems politicians are most frequently promoting ethanol, said Kirk, that's
because they are mirroring what they hear from the public.
"I think political leaders are listening to the opinion of the American people," he
said, "and they want energy independence."
Will we see an ethanol bust?
Skeptic: David Swenson, an Iowa State University sociologist and
economist, said ethanol has triggered a "gold-rush behavior" in the United
States.
It's to the point where investors are seeking corn territories in the Midwest so
they can cash in on higher prices being driven by the increased ethanol
production, he said. And the higher ethanol-driven corn prices are expected to
bring costlier pork, chicken and beef at the supermarket.
Swenson and other agriculture professors said the ethanol boom could bust
quickly. Ethanol profits are said to start eroding when oil is below $70 a barrel,
because demand for ethanol isn't as great.
Proponent: Hartwig from the Renewable Fuels Association disputes the idea
increased ethanol production is nothing more than speculators seeking quick
profits.
"I don't know if I would call it a gold-rush mentality," he said. "Agriculture
professors should appreciate that farmers are getting the market price for the
grain they grow."