Briefing

From the magazine

Is ethanol something new?

Not at all. For centuries, people have distilled ethanol, a form of alcohol, from various plants, including grains, potatoes, sugar cane, and prairie grass. Henry Ford’s prototype Model T was powered by ethanol. But ethanol—specifically, ethanol derived from corn—was first promoted as an alternative to gasoline in the 1970s, when the Arab oil embargo led to gas shortages, long lines at filling stations, and record-high gas prices. Then as now, agribusiness and legislators from farm states touted corn-based ethanol as a way to reduce U.S. dependence on imported oil. More recently, ethanol has played a valuable role as a replacement for the fuel additive MTBE, which contains carcinogens that have shown up in groundwater. Like MTBE, ethanol helps conventional automobile engines burn cleaner, but with fewer toxic byproducts. “Everything about ethanol is good, good, good,” says Iowa Republican Sen. Charles Grassley.

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But is corn the best ethanol source?

Not by a long shot. Ethanol produced from sugar cane has an energy balance of 8-to-1—that is, sugar cane generates eight times more energy than is used to produce, transport, and refine it. Other ethanol sources, such as prairie grass, also have a high energy balance. Gasoline itself has an energy balance of 5-to-1. But corn’s energy balance, according to one study, is only 1.3-to-1—meaning that corn-based ethanol produces barely more energy than is consumed to make it. Other studies have concluded that making ethanol actually consumes more energy than the fuel produced. Nonetheless, almost all ethanol produced in the U.S. comes from corn—about 5 billion gallons this year, equivalent to 20 percent of the U.S. corn crop.

Why is corn-based ethanol dominant?

In a word, politics. Federal mandates to produce more ethanol have been a boon to corn-producing states in the West, enriching farmers and creating thousands of jobs in struggling rural areas. These states wield great power in Washington, which helps explain why Congress has lavished more than $50 billion in subsidies and tax breaks for ethanol since 1995. At least

$10 billion of that largesse has gone to agribusiness giant Archer Daniels Midland, which has spread around $3 million in campaign contributions since 2000. “There’s a lot of ethanol money washing around, and it seems always to go to the corn states,” says environmental scientist Cornelius Murphy of the State University of New York. The largest corn-producing state is Iowa, which happens to hold the first major contest of the presidential campaign season. As a result, presidential wannabes tend to come out early and often for ethanol-friendly policies. Democratic presidential hopeful Barack Obama recently reminded Iowans that he wants to raise U.S. production of ethanol to 60 billion gallons by 2030. Not to be outdone, his rival John Edwards called for 65 billion gallons by 2025.

Is ethanol environmentally friendly?

Not especially. A recent study by Stanford University atmospheric scientist Mark Jacobson concluded that “ethanol poses an equal or greater risk to public health than gasoline.” The burning of ethanol, Jacobson found, produces more lung-damaging ozone than gasoline does. Another problem is that corn growers rely on nitrogen-based fertilizers; rain washes the nitrogen into streams and rivers, where it displaces the oxygen in the water, killing marine life.

Does ethanol have other downsides?

Yes—it raises food prices here and abroad. Ethanol refiners consume huge amounts of corn, and the law of supply and demand means that food producers have to pay much more for the corn that is left. In Mexico, the price of cornmeal tortillas, a dietary staple, has risen 60 percent in the past year alone. In the U.S., corn prices have risen 58 percent this year, causing sharp jumps in the prices of everything from steak (steers are fed on corn) to soft drinks (sweetened with corn syrup). And because farmers are planting more corn to meet increased demand, they have less acreage available for other crops, reducing their supply and increasing the price of everything from potato chips and beer to milk. “We’re putting the supermarket in competition with the corner filling station for the output of the farm,” says environmentalist Lester Brown.

But what about replacing foreign oil?

Even that is something of an illusion. Ethanol cannot be shipped via existing gasoline pipelines, because it readily absorbs water and other impurities. So it must be transported by trucks, which burn fuel and emit greenhouse gases. “We’re importing oil from Saudi Arabia and other places to make ethanol,” says Cornell University environmental scientist David Pimentel. “Is that making us energy-independent?” Existing gas pumps also have to be retrofitted to handle ethanol, at a cost of about $100,000 per station. And most cars can’t burn fuel mixtures that contain more than 10 percent ethanol, because higher concentrations corrode engine parts. Even if engineers overcame these obstacles and Americans consumed every drop of ethanol produced in the U.S., it would still replace only 1.5 million barrels of oil per day—7 percent of America’s daily consumption. “Forcing nation-wide adoption of ethanol makes about as much sense as mandating that all 50 states grow mangoes,” says energy researcher Robert Rapier. “Yeah, it could be done, but at what price?”