Ethanol and NASCAR

The ethanol industry earlier this year teamed up with NASCAR in order to better promote expensive, highly subsidized, not so environmentally friendly homegrown, “renewable” ethanol, including the usage of E15 by NASCAR competitors. What could be more American than combining America’s love for driving cars really, really fast with the idealistic notion of the heroic family farmers growing our own fuel here in America? (Nothing)

The framing of ethanol in the announcement is generous: “NASCAR Gives Ethanol Green Flag.” Given the announcements you might expect that the industry is actually running on ethanol entirely, rather than a blend of 85 percent petroleum and 15 percent ethanol. An alternative framing might look something like this: “NASCAR decreases fuel blend from 90 percent petroleum to 85 percent.” This wouldn’t provide quite the same inspiring sound-bite. (I’m also assuming that NASCAR currently uses a 10 percent ethanol blend which might not be correct)

Take away quotes from the NPR piece:

So, if Jeff Gordon wins the Sprint Series on Sunoco Green E15, ethanol must be liquid gold, right?

It really depends whom you ask. If Growth Energy CEO Tom Buis has your ear, you might think ethanol is good for you.

They wouldn’t be going backwards in choosing their fuel — none of these racing series would,” Buis says. “And so it’s a tremendous opportunity to demonstrate to consumers what a great fuel it is.”

Charles Drevna, president of the National Petrochemical and Refiners Association, disagrees.

“I think it is a complete bastardization of comparison to say, ‘Well, NASCAR can use it, then the average driver can use it’ — no more than you can say, ‘Look, if it is good enough for NASA to put rocket fuel in Challenger, then we can put it in automobiles, too,” Drevna says. “Completely different applications. Completely different fuels.”

Drevna is correct here. The engines of racing cars designed specifically for NASCAR are almost certainly equipped to handle different fuels than that average American care. I trust that they work fine with E15. This link indicates that the average engine costs anywhere from $45,000-$60,000 which is more than the entire sticker price of the majority of cars. They are unlikely to be used for 15+ years like the average American car, which is why these comparisons are useless.

The NPR piece above is one part of a 3-part series on ethanol. Their earlier piece covered the shortcoming of ethanol and the absurdity of the tax incentives they will receive through 2011. It seems to provide an overly negative review of ethanol, citing a net negative energy balance (this is contested by credible people) and potentially low-balling the number of jobs it supports. Overall it is accurate. The RFA responded, and provided a tale filled with many more falsehoods than the potential misstatements by NPR.

A few of the main points from RFA’s response:

American ethanol is the only alternative to imported oil.

Flatly untrue. It is unlikely that it would ever be even possible (let alone desirable) to produce a sufficient amount of corn ethanol to completely displace oil imports. Furthermore, there are other alternatives to oil imports such as ethanol imports, electric cars, and other future technological innovations.

Ethanol offers lots more energy than it takes to produce

Grey area. The USDA study of a 2.3 EROEI is pretty misleading, as documented here by energy blogger Robert Rapier. Furthermore, the assertion that petroleum is a net negative energy balance is laughable and defies common sense, to the point that even I’m surprised that they are willing to publish this and pretend to maintain any shred of credibility. If ethanol provided such a higher return on inputs than petroleum, why would anyone use petroleum in the first place? Why would ethanol need subsidies and mandates to survive? Here is a longer piece explaining that the RFA is comparing two completely different things. My guess is that overall ethanol provides a slightly positive energy balance, with some companies ending as a net negative and some positive depending on location, production structures, etc.

It is worth pointing out though that this critique of ethanol isn’t all that important. For example, tons of energy is lost when electricity reaches its endpoint (originating in a power plant and ending at your refrigerator). This is necessary , and not a bad thing, as the energy has to be converted into a form that the technologies are able to use. You can’t put a piece of coal in your refrigerator. The same is true of fuel. Car engine’s are designed to mainly run on fuel blends. Suppose ethanol required huge fossil fuel inputs in the form of coal or natural gas. If the ultimate energy source ended up being cheaper than petroleum, and something cars were able to use, it would sell.

Ethanol has little impact, if any, on consumer food prices.

False. The quote Dineen uses is taken out of context: “Just a few mere months ago, the World Bank found “…the effect of biofuels on food prices has not been as large as originally thought.” The World Bank study he references was referring to the 2007-2008 food crisis (large spike in food prices). The study concluded that biofuels didn’t deserve much blame for this particular spike (though this is only one study, other studies attributed more blame to biofuels). That study did not conclude that biofuels or ethanol has little effect on food prices generally. It is obvious to anyone with a basic understanding of microeconomics that it does.

Clean-burning American ethanol is good for the environment. In fact, a recent study published in Yale University’s Journal of Industrial Ecology found that greenhouse gas emissions from ethanol are “…equivalent to a 48% to 59% reduction compared to gasoline, a twofold to threefold greater reduction than reported in previous studies.”

Overly optimistic. These studies are incredibly complex, and the RFA looks at one while ignoring the others which don’t provide the desired results. In response to this claim, look at a comment posted at RFA by someone claiming to be the editor of the journal:

The study in Yale’s Journal of Industrial Ecology by mentioned in this blog posting above is one in a **group** of articles on corn ethanol. The 59% reduction in greenhouse gas emissions is the conclusion of one of that set of articles, but it is contested.

Reid Lifset
Journal of Industrial Ecology
Yale University

So, the RFA tactic is obviously to pick your favorite study and throw the rest out, such as the studies that conclude that over its life cycle ethanol actually produces more net GHG emissions than petroleum.

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