Despite its long history as a fuel, ethanol’s popularity has waxed and waned. Since ethanol — also known as ethyl alcohol, grain alcohol and drinking alcohol — became a banned substance with the advent of Prohibition in 1920, Henry Ford’s preferred fuel fell out of favor. It didn’t make a comeback until the oil embargo of the ’70s, and then, after gasoline supplies returned to normal, was quickly forgotten until motor fuel prices began to climb in the late 1990s. As fuel prices continued to rise over the past several years, ethanol’s star burned ever brighter as it began to be seen – again – as the fuel of the future, one that could play a key role in enabling the United States to regain its energy independence.

As ethanol has increasingly come to be viewed as an environmentally friendly, renewable energy source, incentives have been established to encourage its production and use. Congress provided the fuel with its first tax break in 1978, and since that time further incentives in the form of crop subsidies have been added. According to the Environmental Working Group’s Subsidy Database, corn subsidies totaled $56.2 billion from 1995 to 2006. Last year, one quarter of the nation’s corn crop was used for ethanol production, up from less than 15 percent in 2005. In addition, fuel producers receive a 51-cent per gallon tax credit for blending ethanol with gasoline. Domestic producers are further protected by a 54-cent per gallon tariff on imported ethanol.

The demand for ethanol has had a pronounced effect upon corn prices, which have soared from $2.17 per bushel in 2006 to $7.14 in July 2008. This, in turn, has caused an increase in food prices — most famously in Mexico, where the tripling of the price of tortillas caused riots. Since corn is the dominant feed ingredient for cattle, increased corn prices also have driven up the price of dairy and beef products; the prices of wheat and other crops have risen as farmers have chosen to make more money by growing corn instead. And since Congress mandated in last year’s Renewable Fuels Standard that ethanol production be raised from 2007’s 7 billion gallons to 36 billion gallons by 2022, the demand for corn is guaranteed to escalate.

The cost of success

Although the U.S. drive to produce fuel ethanol has been wildly successful by some standards, the use of corn as an energy source has been identified as one of the primary causes of the worsening global food crisis by groups as diverse as the Worldwatch Institute and the World Bank, and resulted in a call to reduce or end farm subsidies for the crop. 

Biofuels production isn’t the only reason for the food crisis, which has caused civil strife and political instability in at least a dozen countries in the last few months. Rising fuel costs, increased demand by the growing economies of China and India, and decreased agricultural production due to droughts, floods, and the conversion of farmland to industrial purposes are also factors that have created a “perfect storm” that some predict could cost millions of lives. And the perception that people in poor countries are starving to death so that people in wealthy countries can better afford to drive their SUVs has tarnished King Corn’s crown. 

It’s increasingly being pointed out that corn has other shortcomings as a fuel crop as well. Ethanol does reduce tailpipe emissions when used to oxygenate gasoline more safely than the environmentally problematic methyl tert-butyl ether, referred to as MTBE. However, according to three separate studies published in the prestigious journal Science, the widespread use of ethanol from corn could result in nearly twice the greenhouse gas emissions as the gasoline it would replace because of expected land-use changes. 

Using corn to produce ethanol isn’t a very efficient use of resources, either. A 2007 U.S. Department of Agriculture study concluded that the energy returned on energy invested, called EROEI, for ethanol made from corn in the United States is 1.34. That means it yields 34 percent more energy than it takes to produce it; some other studies have determined that it takes nearly as much or as much energy to produce corn ethanol as it yields. By comparison, sugar cane ethanol has an EROEI of around 8, meaning it yields eight times as much energy as it takes to produce it. 

Finding the up side 

Regardless of whether it has made sense to promote corn ethanol in terms of economics or efficiency, it has given birth to a new industry, created thousands of jobs and prompted the automobile industry to develop flex-fuel engines certified to run on fuels containing up to 85 percent ethanol. It has also set the stage for the industry to move toward producing a second-generation product from non-food, cellulosic sources such as agricultural waste and the most-often mentioned alternative, switchgrass.

Depending upon the study quoted, native switchgrass (Panicum virgatum), a tall, perennial prairie plant, has an EROEI ranging from four to 10. It requires little if any care and can be grown in a wide range of climates from Nova Scotia and Saskatchewan to most of the United States east of the Rocky Mountains. It can grow in poor soils, and is drought-resistant. All that needs to be done to convert it to energy is to harvest it, break its cellulose down into basic components, add yeast and wait for the resulting fermentation to produce alcohol.

It would be a simple and straightforward process, except that breaking down cellulose isn’t easy or inexpensive. Costly enzymes are required to break down cellulose, and a different enzyme is needed for the fermentation process. Research is under way to develop cheaper enzymes, which will allow ethanol to be produced from switchgrass more economically.

Another problem that will need to be solved in order for switchgrass ethanol to become a viable energy source is the amount of acreage required to produce a significant amount of fuel. A study by Oak Ridge National Laboratory concluded that fueling half the cars on the road today with ethanol produced from switchgrass would require 180 million acres of land — about 40 percent of the agricultural land currently in production in the United States. However, the National Commission on Energy Policy believes that with steady advances, the amount of land required could be reduced to about 30 million acres, which coincidentally is the amount of land that the United States now pays farmers to allow to lay fallow.

Corn’s role in climbing food prices combined with the potential of cellulosic ethanol has many on Capitol Hill thinking about the previously unthinkable: curtailing subsidies for corn ethanol. Although such a move would undoubtedly encounter staunch resistance from corn-producing states, the market forces involved could be enough by themselves to cause a switch to switchgrass. As one farm association official put it: “Our members can grow corn, soybeans or switchgrass. We know that corn ethanol is a first-generation biofuel, and our members will turn to growing stock for next-generation cellulosic ethanol as it becomes economical.”

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