Ethanol and its discontents

Biofuels are going through a very rough patch lately. As recently as a year ago, smart money was betting that ethanol from corn would be the main way to reduce the global warming effect of vehicle fuels in the US: it’s available, the technology is well-developed, actually much like making bourbon whiskey, and seemed to be pretty green; after all, the carbon in the fuel is taken from the air by the plants, so the only greenhouse gas (GHG) effect is from incidental sources like diesel to drive the tractor. Not too far away, we anticipated super-green ethanol not just from starch in seeds, but from the whole plant, awaiting any one of several “almost-there” technologies to unwind cellulose from the lignin that ties it together and then to split it up into sugars yeast can eat (yeast eats sugar and pees ethanol (and burps carbon dioxide, actually)). Using the whole plant would produce really enormous yields compared to corn, or to the other biofuel, diesel from various oily seeds. In early 2006, I was a coauthor of a Science paper entitled “Ethanol can contribute to energy and environmental goals”. However, I am also waiting since the 70s for the battery that would give an electric car a 500-mile range and continues to be just a few more tests and twiddles from the market, so while I’m cheering from the sidelines, I’m not putting any 401k money into cellulosic biofuel startups.

A colleague of mine, Mark Delucchi, at UC Davis, has been trying for more than a decade to draw everyone’s attention to something not so obvious until you really think about it, which is that if corn is used for ethanol, it isn’t being used for food (or feed), and the demand for food is quite inelastic. No-one estimated the consequences of this until last January, when Tim Searchinger, a lawyer at Princeton and the German Marshall Fund, sat down with several colleagues and actually traced the corn deficit to increased corn planting on land that used to grow soybeans, and the increase of soybean land to make up for this by displacing (for example) cattle in Brazil, and the advance of cattle into the rain forest. (The chain of dominoes in the previous sentence is much oversimplified, in fact many kinds of land are converted from wild conditions to crops when food land is used for fuel.) The important thing is that the CO2 releases from burning and decay of this wild vegetation turn out to be really big; as far as we can tell so far (and several teams including my own group are all over Searchinger’s model like a cheap suit to see if [even] better modeling and data change the answer) what we call indirect land use change (iLUC) discharges are large enough to push the GHG index of corn ethanol and even cellulosic – any fuel crop grown on land that could grow food – way above that of gasoline.

Downer, huh? And the bad rep has spread over other biofuels, including for example biodiesel from palm, which tends to displace not only rain forest but rain forest on peat soil; when the soil dries out and decays, the carbon releases are really enormous. Governments in Europe and the US are doing some serious backpedaling on requirements for biofuel content in vehicle fuel, and the biofuels industry is taking big whacks for increasing food prices (not all of this piñata bashing is sound or backed up with data). Planned ethanol refineries are being shelved all over the Midwest.

One feedstock in current use that has real promise, however, is sugar cane. The Brazilians got into the cane ethanol business in a big way starting in the 70s, and now it’s half their transportation fuel. What makes it so attractive is that the cane plant, a big fat grass, for adaptive reasons no-one has yet explained to me, fills up its whole inch-thick stalk with pancake syrup; you just squeeze it out and start making rum or fuel ethanol, and you don’t even have to turn starch into sugar. In the tropical conditions it likes, yields are high and you can even use the plant’s cellulose (called bagasse) as fuel for the refinery and get extra energy to put into the grid as electricity. Since the government stopped subsidizing it, the industry has predictably become very efficient. The Brazilians are quite anxious to sell us a lot of their cane ethanol, if we would only remove the 50c per gallon tariff we keep it out with.

Indeed UNICA, the Brazilian cane growers’ and refiners’ association, was nice enough to fly me down there to scope it out [note risk of cooptation and prejudice, you should be as suspicious of my views as you see fit], hence my recent two weeks in Brazil, learning about the actual process of land use change at the sharp end, but also getting connected with people who could help us estimate the iLUC effect of cane ethanol itself. So far the GHG analyses of cane ethanol walk right up to this issue and then go into assertion mode, assuring us but not really showing that iLUC will not be a big number for this product.

Of course no-one in this business wants to be disillusioned again. In a few months I think we will have real numbers, until then I’m agnostic. Making good predictions, specifically of the iLUC effects of increasing cane ethanol production, is not simple. For example, it seems pretty clear that cattle production in Brazil could be much more efficient than the one animal per hectare typical of the northern Mato Grosso pastures, so in principle, cane land needs could be sopped up by squashing the cows a little closer together. But (i) will they, and if so why, if cattle production is inefficient now and the forest beckons loggers and ranchers along a thousand-mile frontier? (ii) either way, should that count in ‘scoring’ the ethanol; it will use agricultural land whether cattle farming is efficient or not, and not making it would maybe allow the forest to grow back into unneeded pasture freed up by better ranching, sequestering lots of carbon. A good case can be made that ethanol’s iLUC is ethanol’s, whether it’s caused in a world of increased productivity and forest expansion, or low productivity and forest retreat: if it’s a good idea to improve cattle land use efficiency, it’s a good idea whether someone is making more ethanol from cane or not.

Watch this space for further details, I guess.

Author: Michael O'Hare

Professor of Public Policy at the Goldman School of Public Policy, University of California, Berkeley, Michael O'Hare was raised in New York City and trained at Harvard as an architect and structural engineer. Diverted from an honest career designing buildings by the offer of a job in which he could think about anything he wanted to and spend his time with very smart and curious young people, he fell among economists and such like, and continues to benefit from their generosity with on-the-job social science training. He has followed the process and principles of design into "nonphysical environments" such as production processes in organizations, regulation, and information management and published a variety of research in environmental policy, government policy towards the arts, and management, with special interests in energy, facility siting, information and perceptions in public choice and work environments, and policy design. His current research is focused on transportation biofuels and their effects on global land use, food security, and international trade; regulatory policy in the face of scientific uncertainty; and, after a three-decade hiatus, on NIMBY conflicts afflicting high speed rail right-of-way and nuclear waste disposal sites. He is also a regular writer on pedagogy, especially teaching in professional education, and co-edited the "Curriculum and Case Notes" section of the Journal of Policy Analysis and Management. Between faculty appointments at the MIT Department of Urban Studies and Planning and the John F. Kennedy School of Government at Harvard, he was director of policy analysis at the Massachusetts Executive Office of Environmental Affairs. He has had visiting appointments at Università Bocconi in Milan and the National University of Singapore and teaches regularly in the Goldman School's executive (mid-career) programs. At GSPP, O'Hare has taught a studio course in Program and Policy Design, Arts and Cultural Policy, Public Management, the pedagogy course for graduate student instructors, Quantitative Methods, Environmental Policy, and the introduction to public policy for its undergraduate minor, which he supervises. Generally, he considers himself the school's resident expert in any subject in which there is no such thing as real expertise (a recent project concerned the governance and design of California county fairs), but is secure in the distinction of being the only faculty member with a metal lathe in his basement and a 4×5 Ebony view camera. At the moment, he would rather be making something with his hands than writing this blurb.