Count the cost of ethanol gasoline

How much are you willing to pay for "green" - environmentally-friendly - gasoline?

We speak of ethanol, the corn-based fuel of the future that is supposed to eliminate OPEC and the other sorry oil-producing foreign bastards from our lives.

Earlier this week we read a report that suggests farm and energy experts have seriously miscalculated the amount of corn that will be necessary to produce ethanol this year (and in future years). Corn prices, already soaring, could go so high that your average American will not be able to purchase corn-related products for food consumption, not to mention the impact such prices would have on beef and pork production (and prices).

That's alarming enough.

Yet today, whilst reading The Mogambo Guru's weekly diatribe on the economic madness that is the 21st Century, we came across this:

In the Whiskey & Gunpowder newsletter we read that the energy density of ethanol is less than petroleum, as "The standard, accepted measurement of energy density for ethanol is 26.8 megajoules per kilogram. This clearly compares unfavorably with the energy density of gasoline at 45 megajoules per kilogram."

So, you get a lot less energy per unit of weight. Worse, "The energy return on energy investment (EROEI) of ethanol" is "break-even at best", because oil just gets pumped out of the ground at minimal energy expense.

He asks the pertinent question. "So will the U.S. really wind up running its motorized culture on corn-based ethanol? According to Cornell researcher David Pimental, if the entire U.S. grain crop were converted to ethanol, it would satisfy about 15% of U.S. automotive fuel needs. The answer is no."

But that doesn't mean we won't try, as seemingly evidenced by Bloomberg when they report that the price of corn has surged to a 10-year high, "sparking rallies for soybeans and wheat, after the U.S. forecast the smallest global supplies in 29 years as record demand for ethanol uses up more of the crop.”

Our bottom line: we can't get rid of OPEC by converting crops to gasoline. The Mogambo's bottom line?

Hahaha! You slightly reduce the necessary increase in imported oil needed to satisfy an increasing demand for energy, but at the cost of making everybody's food horrendously more expensive? Hahaha! This is too, too rich, and government meddling at its worst!

If you are one of those environmentally-sensitive people who do not give a damn about the fate of individual human beings, then perhaps you are pleased with the thought that greater E-gas will lead to malnutrition, disease and starvation deaths on a massive scale, thus bringing about more rapidly the human die-off some believe are envisioned by the United Nation's Millennial Goals. Our would-be global masters foresee a world of about 500,000 million people living in harmony with nature and one another, or at least that's the word from various conspiracy buffs. (It also happens to be one of the "suggestions" on the Georgia Guidestones.)

You don't have to believe in the conspiracy theories to realize that there is a big economic modelling problem with ethanol. And before you interject that surely this is a great opportunity for the small farmer to increase his corn acreage and profits, we have to point out that the small farmer is pretty much a thing of the past, and the money it takes for a small farmer to become a player against the corporate farming colossi is prohibitive.

We'd say it's about time for that cold fusion technology to come out of the closet.