Why Corn-Based Ethanol Sucks

by Richard T. Stuebi

While it is increasingly recognized that subsidies for corn-based ethanol are bad policy, a nod must be given to C. Ford Runge, a professor at the University of Minnesota, for his pithy and merciless analysis in his note “Biofuel Backlash” published in the May/June issue of Technology Review.

In the space of just a few short paragraphs, Prof. Runge cites the work of Earth Track (a firm dedicated to exposing subsidies detrimental to the environment) projecting $400 billion of U.S. subsidies to ethanol between 2008-2022, notes a recent estimate by the Earth Policy Institute that the 2008 U.S. corn crop diverted for ethanol production would have been sufficient to feed 330 million people for a year, and provides a reference to modelling that indicates a near-doubling of greenhouse gas emissions due to changes in land-use patterns associated with corn-for-ethanol production.

It’s amazing that such awful policies, which are so adverse on so many dimensions, can survive. But, in the gameboard that is U.S. energy, environmental, and agricultural policy, only grand compromises supported by the big boys can get enacted — which are then extremely difficult to overturn when they are seen to be nothing more than gifts to their well-positioned and deep-pocketed sponsors and supporters.

Reiterating a point I’ve made before: I have nothing against ethanol per se. Cellulosic ethanol, if it can be accomplished cost-effectively, is a promising prospect for reducing greenhouse gases and reliance on Middle Eastern petroleum without chewing up valuable foodstuffs. But corn-based ethanol plainly sucks. And, the notion of using corn-based ethanol as a bridge to cellulosic ethanol is dubious at best.

The old adage says that a camel is a horse designed by committee. Would it were that U.S. biofuels policies were as lovely as a camel.

Richard T. Stuebi is a founding principal of NorTech Energy Enterprise, the advanced energy initiative at NorTech, where he is on loan from The Cleveland Foundation as its Fellow of Energy and Environmental Advancement. He is also a Managing Director in charge of cleantech investment activities at Early Stage Partners, a Cleveland-based venture capital firm.

13 replies
  1. Anonymous
    Anonymous says:

    If we (americans) want to eventually commercialize cellulosic ethanol we need to have pumps and pipes and plants and vehicles to produce and use that fuel. Much of that infrastructure is in place and more cars and gas stations are being built every day to burn and dispense E-85. Corn based E-85 now, corn cob based E-85 later. Kill corn ethanol and you'll put cellulosic ethanol progress back 15 years. You can't see the forest for the trees!

  2. M.B.A. Project
    M.B.A. Project says:

    It's unfortunate to have read Richard Stuebi's posting and his characterization of "awful" ethanol policies. What's awful and tragic is our continued dependence on imported oil–we are sending $20 billion to $30 billion overseas each month. Think about how many jobs and economic opportunity that money could create here at home if we didn’t siphon it out of our economy to subsidize the economies of other nations. And it's disappointing to read about the same old, tired argument on food vs. fuel. Just last week, the USDA came out with the latest corn crop estimates that prove U.S. farmers can provide enough corn for food, feed and fuel. Once again, refuting the claim that ethanol production impacts food prices. For instance, corn supplies are projected at a record 15.1 billion bushels, up from last year. And according to the Yale Journal of Industrial Ecology, from "well to wheel," ethanol from today's biorefineries reduces greenhouse gas emissions by 59% compared to gasoline.Keep in mind that ethanol is homegrown, by American farmers – and the jobs related to ethanol production can't be outsourced. Ethanol is here, it's available…and it's the only sustainable, domestic fuel that works in the gas-engine cars we already have.Stuebi referenced the old adage, "a camel is a horse designed by committee. Would it were that U.S. biofuels policies were as lovely as a camel."Actually, there's a better adage that more appropriately describes the ethanol industry, "waste not, want not." If we don't waste our hard earned dollars and export them overseas to countries that don't particularly care for us, we'll still have our precious resources, independence in the future and will not lack it.

  3. danielskiffington
    danielskiffington says:

    Interesting post, Richard. I'm curious to see how U.S. will policy will change (or not change) in regards to corn-based ethanol. I am curious if CleantechBlog has an e-mail where possible story ideas can be sent? – Daniel

  4. gametheoryman
    gametheoryman says:

    Corn subsidies were introduced with one primary purpose: to create infrastructure in the market so that cellulosic ethanol could be introduced much more quickly than it would otherwise. The rest was political and journalistic detritus.If corn subsidies had never been put in place, but R&D subsidies for promising cellulosic technologies remained, it would be 5-10 years longer before any successful cellulosic technology had any significant fuel market share.Is this a dubious bet? Given that our desire for stable oil prices distorted our foreign policy and military structure (as with all developed oil importing nations) to support Mideast strongmen, which eventually led to a violent backlash resulting in a revolution in Iran, two Iraq wars, the 9/11 attack, a war in Afghanistan, and the general war on terror, I think not.If we could have done this sooner, our ideals and at least $3 trillion dollars would be intact.

  5. Anonymous
    Anonymous says:

    Great choice of words, 'sucks'. The title just spews briliance and the way it was used in text was even better. Maybe next time you should use 'pooky' or 'sniffles'. Why don't we estimate the total subsidies dished out to oil refiners in the same time frame and then compare the two? I have a feeling that ethanol would come out smelling like a rose in comparison. Oh wait…Big oil has boggled your brain to think that it is pumped out of the ground and refined for free. Let's stand for keeping money at home instead of sending it over seas.

  6. Anonymous
    Anonymous says:

    Not that your note is founded on logic (diatribe is not reason), but if you're so upset at corn going to ethanol, what about corn going to beef cattle instead of to feed people directly?

  7. Anonymous
    Anonymous says:

    I agree with your statement that Corn Ethanol sucks. It's simple, Corn Ethanol only gets 15-25% Carbon Reduction. We can do much better with Advanced Ethanol from Sugarcane and Sugar Beets that get 85% Carbon Reduction. Take away the credit for Corn and put it on Advance Ethanol. Remove the tariff on imported Sugarcane Ethanol and America will get cleaner by next year. Cellulosic is always 10 years away and I have given up on them. I think we should move half of the research money from Cellulosic to Algae to produce Ethanol from CO2 and finally clean up the Coal.

  8. jay
    jay says:

    Cellulosic Ethanol is not ten years away. It is here it is now. As we blog, more cellulosic plants are being planned, designed, build and tested for production. Every single corn ethanol plant can be converted into cellulosic ethanol plant. The key to the problem is again chicken and egg. With out ethanol production ability, there is no market. Without a market cars will not be built for it. With out cars there is no market to sell product. As a country we have walked a fine line with ethatnol. We are on the two yard line. We need a final push to get us to a fully functional market.

  9. jlploehn
    jlploehn says:

    I think we are a whole lot better off with corn ethanol than what is happening now in the Gulf. That is truly an environmental disaster. Ethanol is not perfect but what is? There are no soldiers or wildlife or fish dying to protect our source of ethanol. Ethanol is one of the good alternatives we have for an energy source. Lets use our brains and support the good sources (like ethanol and wind) and use less of the bad (like oil, that has bad things happen to people and all sorts of wildlife).

  10. Anonymous
    Anonymous says:

    Gametheoryman and most of the other commentators here are spouting the usual rubbish, justifying an expensive policy after the fact. Corn-ethanol subsidies were NOT introduced to create infrastructure in the market so that cellulosic ethanol could be introduced much more quickly than it would otherwise. That is total post-hoc fabrication.The current subsidies trace their origin back 32 years, when there was no prospect of cellulosic ethanol quickly coming along to displace corn ethanol. They were put in place to please ADM — a major financial contriibutor to Midwest senators of both parties — and Midwest corn farmers. The main subsidy, on which the current VEETC is based, was not created as a result of any carefully determined cost-benefit but through a simple, and simplistic, administrative decision to exempt gasahol (E10) from the federal fuel-excise tax. That's it.The industry now is trying to re-invent the history of the corn-ethanol subsidy and claim all manner of side benefits. The fact remains: the main beneficiaries of corn ethanol support policies are the industry itself, and the corn farmers that supply it.The ethanol industry has its renewable fuel standard. It should be happy with that and stop fighting to continue extending a subsidy and a protective import tariff that have long outlived whatever value they may have had in the first place.

  11. Soylent
    Soylent says:

    Anon(the last one, the one without rocks in his head) correctly points out the post-hoc stories told of the ethanol subsidies; but even if they were true, there is no guarantee that the government correctly picked the winner and if they did not they hindered better approaches.It might be that electric(either battery or fused-silica flywheels) are the winner; it might be butanol produced by fermentation with cellulose eating GM-bacteria(not as corrosive and no need to distill); it might be dimethylether produced by gasification of biomass with a special one-step conversion zeolites.You don't know, the government doesn't know; the only way to find out is to let a thousand flower bloom and not tilt the playing field in any particular way.

  12. art
    art says:

    I hate ethanol. I get much worse MPG and there is no benefit to it. My lawnmower hates it too.
    It is all political and that is the reason it exists. Its not any cheaper, worse gas mileage. Stop the insanity.

  13. Jay
    Jay says:

    In Florida it is a $5000 fine for a Gas Station to sell gas to a customer for their vehicle. They can buy it for their boat, tractor or even put it in a gas can or a 55 gallon drum if they want but pump it in your car and you might get the Nazi's from the corn belt after you.

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