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Napanee, Ontario | Wanted to start a new thread so everyone could read the brilliant response Mr. McAfee wrote to the author of the slam piece in Forbes (below). So I copied in the comment here.
I suggest that everyone copy and paste and get familiar with these talking points so that we can all work to dis-spell the lies and falsehoods that that media has all our neighbors, friends and others believing.
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http://www.forbes.com/sites/jamesconca/2014/04/20/its-final-corn-et...
James, thank you for your interest in cleaner, more sustainable fuels and chemicals. The oil industry currently benefits from a 90% gasoline mandate in the US (the artificial “Blend Wall” created by the oil industry due to an unwillingness to invest in biofuel blender pumps at retail gas stations). Your diligent efforts to break the 90% crude oil gasoline mandate in favor of renewable, 113 octane, high oxygen, cleaner, domestic, job-creating fuels are to be encouraged!
Due to your scientific background and experience cleaning up hazardous waste sites, you are probably aware that corn is not a single molecule or material. Rather, corn is comprised of about 72% starch, which converts to sugar in the body of an animal. The other 28% of a corn kernel is primarily protein, corn oil and fiber, which are the valuable “distillers grain” components of animal feed extracted from the corn kernel by an ethanol plant.
The enzymes in ethanol plants convert the 72% starch from corn kernels into sugar, which is fed to yeast in order to produce ethanol. So, ethanol plants are “waste processing facilities”, since none of the valuable corn proteins, oils or fibers are converted to ethanol.
Instead, ethanol plants extract the 72% of lower-value, starch “waste” from the corn kernel and produce a concentrated, high-value, Distillers Grain animal feed from the remaining 28% of the corn kernel. Since this concentrated animal feed is able to be fed without the 72% starch “waste” material, it is more valuable per ton than corn: especially to China and the other 80 countries that purchase Distillers Grain from the US to feed animals at a lower cost (including import tariffs) than purchasing and transporting whole corn with 72% starch from the US.
To update you on recent developments in the biofuels industry during the past three years, the $0.45 per gallon VEETC (known as the Blender’s Tax Credit since it was paid to oil companies and not to farmers or ethanol plants) was terminated by Congress in December 2011, along with the $0.54 per gallon tariff that protected US ethanol producers from heavily subsidized Brazilian sugarcane ethanol. You are probably aware that commencing January 1, 2012 the ethanol industry received no subsidies at all from the federal government on a per-gallon basis.
Since you have an interest in cleaner, less expensive fuels, you will be pleased to learn that biofuels have enabled the agricultural section in the US to no longer receive large farm subsidies that were required prior to the use of ethanol as a vehicle fuel. These USDA and other subsidies paid farmers NOT to grow corn – known as the Set-Aside Program – at a cost to taxpayers (the same people that buy food) of up to $5 billion per year. Due to the economic viability of corn production as a direct result of ethanol produced by waste processing facilities known as ethanol plants, farmers no longer qualify for billions of dollars of annual subsidies to not produce corn.
Ethanol is 113 octane and about 30% oxygen, allowing the lower quality 82 octane gasoline now being produced by oil refiners to meet fuel performance and federal air quality requirements. Oxygen makes crude oil gasoline burn cleaner. Without ethanol, the average gasoline currently produced in the US would not able to be legally sold as a vehicle fuel.
Increased octane is virtually certain in the future in order to comply with fuel economy laws. Your fuels and chemicals experience most certainly includes an understanding of the role of octane as an ignition inhibitor to allow engines to produce more energy from a gallon of fuel at high pressures caused by turbocharging smaller engines. Indy race cars run on 100% ethanol and NASCAR uses 15% ethanol in order to achieve higher mileage and more horsepower by utilizing the 113 octane in ethanol.
In 2013, the EPA stated that it would no longer accept engine tests that did not contain at least 15% ethanol in the test fuel, and the EPA sought engine manufacture standards for testing 30% ethanol. Why? The EPA stated that the 54 miles per gallon CAFE fuel efficiency standard would not be achievable in a gasoline engine without a 30% blend of the 113 high octane provided by ethanol. It looks like future engines will be closer to the 113 octane ethanol in Indy cars than the poor quality “bunker fuel” often used in the large engines of oceangoing ships.
Lastly, any commentary claiming “harm” by corn farmers or the use of ethanol or any other biofuel should consider that every gallon of biofuel displaces a portion of the $1 billion per day of US investment capital that is exported to purchase foreign crude oil. This is the equity for the growth of the US economy, being spent on the purchase of a consumption item, not a capital investment in future productivity. The economic “multiplier effect” is enjoyed by OPEC and other foreign crude oil producing countries, not the US. Simply noting the location of the multiplier effect is being transferred to US workers should be sufficient for the amateur economist to understand a basic cost of imported crude oil: a $1 billion daily economic drain on the US economy.
Since you have read this far, please consider any future articles about biofuels to be a comparison with the economic, environmental and social impacts of the mandated fuel that we are currently mandated to purchase by the monopoly that controls the fuel retail outlets in the US: the crude oil industry.
In the future, please compare the biofuels industry to the oil and gas industry, which receives more than $100 billion per year of direct cash subsidy from the US taxpayer: 1) 100% tax-free earnings using Master Limited Partnerships to own facilities and pipelines (MLP’s are illegal to use for biofuels facilities); 2) accelerated tax write-offs for well drilling (illegal for corn farmers and ethanol plants); and 3) more than $100 billion per year of military protection for shipping lanes and foreign oil fields.
Our generation has a burden to undertake the technology innovation, investment and operational management to provide renewable, sustainable alternatives to the dwindling crude oil reserves that are increasingly expensive and environmentally damaging to produce. Whether your view of Peak Oil is that 2006 was the high point for oil production, or whether you are bullish on tracking, Canadian tar sands and offshore drilling, the future of oil production is significantly higher costs of production.
A quick look at the stock prices and quarterly earnings of Green Plains, Pacific Ethanol and others will show that biofuels production is financially sustainable. Using sunlight to grow a crop, then removing the waste starch to produce a 113 octane oxygenate called ethanol and selling higher value protein/oil/fiber animal food is a less expensive way to produce fuel.
As a biofuels CEO recently stated: Ethanol is the least expensive molecule in the fuel tank, and a lot of domestic and foreign consumers want to buy it.
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Eric McAfee's comment in The Forbes Article (Below)
