June 2005
Columns

Editorial Comment

Response to letters; oil prices and inflation
Vol. 226 No. 6 
Editorial
Fischer
PERRY A. FISCHER, EDITOR  

Biofuel letters. I’ve received many emails and letters commenting on this column. Thank you, one and all. One theme has occurred more than any other, centered around biofuels. My feeling on these fuels is that the present systems in place in the US, Brazil and Europe do not meet many of the goals that they were intended to, especially as an environmental benefit. Using prime farmland for growing food crops for fuel is a profoundly crummy choice for land use. It’s akin to covering prime farmland in solar cells, only doing that – which would also be stupid – would at least be more environmentally sound.

Using food for fuel increases agricultural runoff, silt buildup and pollution in rivers, and worsens the so-called dead zones that form offshore river deltas, such as the Mississippi. It adds CO2 to the atmosphere (except in the rare instance when it is captured and used), usually uses coal as a heat source, and it is questionable whether there is a net air pollution benefit when added to fuel. In Brazil, massive swaths of the Amazon are continually being cut down for biofuel use. And all of it made possible by huge governmental subsidies. The pro-environmental reasons pale in comparison to the negative effects. It is more about politics than anything.

It does, however, ease dependency on oil imports. In Brazil, gasoline contains about 25% biofuel. The US and Europe can probably achieve and hold, say, 3 – 5% of their fuel from biological sources, depending on prices, growth in fuel demand and politics (subsidies).

But all of that changes when the rapid advances in biotechnology and genetic engineering kick in. The increasing ability to convert cellulosic (woody) plant materials into biofuels could produce substantial amounts of liquid fuel in a much more environmental and economical manner. The benefits increase even more if this is combined with genetically modified plants. A letter from F. David Doty, PhD, was typical:

“It is true that corn ethanol is not an efficient use of food, and biodiesel from soy may make even less sense; but Brazil is currently producing over 5 billion gallons of sugarcane ethanol per year at under $0.60/gal, and their production will likely quadruple over the next decade. There are a host of next-generation biofuels that make sense in other climates. The first of these is just hitting the market here – cellulosic ethanol.

“The cost of producing the cellulase enzyme needed to turn waste wood into high-grade fuel has been cut by a full order of magnitude over the past decade, and another factor of two is expected within a few years. Ethanol from waste wood will soon be half as expensive (per unit of energy) as gasoline. Ethanol, methanol and biodiesel from efficient fuel crops, such as switchgrass, mustard, eucalyptus, algae, hemp, pines, kudzu, and poplars, will very soon be cheaper in the US per unit of energy than gasoline at $2.5/gallon. At the end of the day, the death knell to the hydrogen dream is the practicality of clean, convenient, renewable biofuels coupled with advanced, high-efficiency, hybrid engines.”

There are other letters centered around biofuels and biodiesel hybrids. Biodiesel, like ethanol, can be done badly or well, depending on many factors. Diesel sits at the top of the liquid-fuel energy density chart. Biodiesel, because it is a blend of plant-extracted oils and methanol, sits a little lower.

When used in an electric hybrid, especially in a high-compression direct-injection engine, diesel has even greater potential than gasoline or hydrogen for high fuel efficiency. Take, for example, Toyota’s famous little four-passenger Eco-Spirit 3 diesel hybrid. Rated at 87 mpg, it was unveiled in 2001 as a concept car, and then forgotten. I should mention the obvious, which is, when cars get small and light, they always get better gas mileage. But much less attention has gone into making them crashworthy. The best example I can think of was the VW diesel rabbit, which was rated at 55 mpg.

Larry Sullivan has spent most of his adult life working for both large oil companies and oilfield suppliers, between “big oil and big soy/ corn,” as he puts it. He writes:

“While I agree that current ethanol production technology and capitalization is suspect, I appreciate your comments on new enzymatic processes (Iogen, Novazyme, Genecor, for example). I am consulting with the use of lipase enzymes for biodiesel (methyl ester) production to reduce that cost below petroleum diesel. These are exciting developments in renewable fuels.

“Renewable fuel contributions to the total transportation fuel pool could approach 20% in twenty years. That would pull the US out of the significant importation of energy and finally dispel the myth, ‘we can use other countries’ oil until the day we need to use our own.’ Except our own will be renewable, not crude petroleum; as you know, we simply do not have that much left in the Lower 48. You would not believe how many Midwesterners believe oil companies control the market and can switch on production as needed anywhere in the US! Our industry has done a sad job of selling its image.”

Ooops! The chart that you see below was omitted from an article in May, Mitigating a long-term shortfall of world oil production, by Hirsch, et al. We regret the mistake, especially in the midst of an otherwise excellent article. It is interesting in its own right. The pertinent copy reads:

“As seen in Fig. 6, oil price increases have preceded four out of six US recessions since 1969, and virtually every serious oil price shock was followed by a recession. Thus, while oil price spikes may not be necessary to trigger a US recession, they have proven to be sufficient over the past 30 years.” WO

Fig 1

Fig. 6. Oil prices and US recessions: 1969-200323



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