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Biofuels lure U.S., but agreement on cost elusive
08 Nov 2006 21:04:51 GMT
Source: Reuters
By Missy Ryan

WASHINGTON, Nov 8 (Reuters) - Politicians may be pushing ethanol as a magic bullet for the United States' foreign energy addiction, but even biofuels experts disagree about the cost, efficiency and viability of a ramped-up U.S. biofuels program.

Experts at a biofuel conference on Wednesday easily agreed on the urgent need to wean the United States from foreign oil, which now makes up about 60 percent of U.S. oil supplies.

In recent decades, ethanol has been become an increasingly attractive choice to sidestep volatile oil prices and avert the environmental toll of burning fossil fuels.

Ethanol in particular -- made mostly from corn in the United States -- has become a bipartisan winner in Washington.

U.S. law now mandates that refiners and gasoline blenders use at least 4 billion gallons of biofuels a year. That is set to hit 7.5 billion gallons by 2012, but could ramp up even faster under a plan floated by Democrats, who took control of the House of Representatives in elections this week.

But scientists and other experts still disagree over how much energy biofuels could save, how much they'll cost in the long run, and how widespread use would affect the environment.

"If we're going to make sound decisions ... about energy, we need to understand what we're talking about," Bruce Dale, a chemical engineer at Michigan State University, said at the conference, sponsored by the American Enterprise Institute, a conservative Washington think tank.

Dale and many others are confident that switching from gasoline to corn-based ethanol would reduce greenhouse gases.

He said biofuels hold great promise overall if new technologies whittle down processing costs, which now account for the bulk of making ethanol, and can deliver more efficient ways to feed cattle.

Yet some in the U.S. farm sector worry about how expanding ethanol production could affect livestock production. Others worry about the true public policy costs of ethanol, which enjoys large government subsidies, and how much of the biofuel can be produced.

According to David Pimentel, an ecology and farm science expert at Cornell University, almost a fifth of U.S. corn goes to make ethanol today, but that amounts to a fuel equivalent of only about 1 percent of oil consumption.

Even if all U.S. corn went to make ethanol, he said, it would satisfy only a fraction of U.S. energy needs.

Lester Lave, an economist at Carnegie Mellon University, projected the cost of producing bioethanol -- currently around $0.60 a gallon -- could eventually get down to $0.34 a gallon.

That would make biofuels even more appealing if oil prices slide further. But Pimentel said that the economic and environmental costs of producing corn -- and other fuel fodder like woodchips, rapeseed, or switchgrass -- cannot be ignored.

Producing corn quickly becomes costly when one takes into account farm labor, machinery used in fields, and irrigation, Pimentel said. Policymakers must also think about soil erosion and the use of nitrogen fertilizers, he said.


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Last updated:Wed Nov 8 21:06:33 2006