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D.C. Chuckle
I got a laugh reading this one from the CBO (Link).
The cost of the review of ethanol is a measly $1m. Why has it taken so many years to have this study? More importantly, what happens if this study shows that ethanol is proven to be a dud? Answer:
No later than 30 days after the assessment is completed, EPA would be required to submit a report to the Congress, indicating whether the agency agrees with the study’s findings. The NAS and EPA would have 18 months from the time of enactment to complete the study. Mid-level ethanol blends could not be sold until after EPA issues its assessment report.
A few data points on ethanol:
- 10% of all gasoline sold contains ethanol. That comes to 13 billion gallons of alcohol, $25-30b of cash flow a year.
- The energy content of ethanol is 33% less efficient than gasoline by volume.
- Using E10 (10% ethanol) reduces mileage by 3.3%.
Americans drive 3 Trillion miles a year (incredible). If all of the drivers used blended gas containing 10% ethanol it would mean that the reduced efficiency would cost drivers 100b miles a year, or $350B. The actual losses to drivers is less than that calculation as not all gas consumed has ethanol, but the number that consumers pay as a result of ethanol is well in excess of $50b - serious money.
The politics of ethanol is interesting. The House Bill that would force the review of ethanol comes from Congressman Lamar Smith (R-TX). Lamar is the head of the Committee on Science, Space and Technology (CSST). Smith also represents Texas. Does Congressman Smith have an axe to grind in this story? Sure he does - Texas is oil and refining. Those who produce oil and the refiners who convert it into gasoline have a lot at stake. If ethanol is scrapped, then big oil and big refiners will win big. One can be pretty sure that the 'results' of the proposed study are already known. H.R. 875 would not have gotten as far as it has unless guys like Lamar Smith already know the answers on ethanol.
Ethanol is a renewable energy source - so that makes it Green. The Administration, and a fair number of Democratic Senators have IOUs to the Greens. The folks who want ethanol have a very big support base. That support base includes environmentalists, corn growers and ethanol producers - but it doesn't include consumers.
There are some market related consequences to H.R. 875. Should it pass, it will knock the ethanol producers for a loop, the refiners will see a benefit, and I wouldn't want to be long corn if this Bill comes into being.
I'm not worried too much about the companies who make ethanol, nor do I think that corn is headed for a tumble. H.R. 875 will never see the light of day. And that is the joke in this story. For a lousy million bucks the answers to this could be available for the public to consider. But the public will never have a chance to see those results. We will continue to burn our food and use inefficient energy supplies for years more to come. Welcome to America and its stupid politics.
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no no no, they told us it was a movie!
That was the second ARAB spring.
Pacific ethanol is down 99.99% should that short be covered?
$320 Q@ 2006 to $0.29 today.
how many analysts had buys during 2006 on this?
Corn ethanol is not green, is uneconomical and has only benefitted politicians and ethanol corn farmers.
Fulltard.
ADM bought up all the bankrupted ethanol processors during the recent financial unpleasantness, some 19 plants as I recall. Just end the fifty cents per gallon subsidy.
Bruce-No problem- but as part of the study, let's study how much the petroleum industry cost the US taxpayer every year. From oil depletion allowance to protecting the oil industry and shipping in the middle east, to outright subsidies, you'll blow past $50 bln in a nano second- but I NEVER hear anyone talk about it. It seems the petro industry is sacrosanct.
Well I'm an oily kind of guy and I've got an idea that I'm certain you'll stand up and salute since you're not a subsidy kind of guy. Suppose we terminate ALL gummint subsidies, to include ALL public lands, including National Sacrifice Areas Parks (which are also a subsidy), except perhaps those originally intended (arsenals, etc.).
That industry produces far more in taxes than in profits, per gallon of fuel. Far more.
don't know who down arrowed you but they are an ignorant shill. consider these facts...
Exxon profit per gallon of gasoline - $0.07
Federal taxes per gallon of gasoline - $0.184
NC State tax per gallon of gasoline - $0.512
Decreasing fuel efficiency is a stealth tax increase but think of the boon to the economy from the damage ethanol does to small engines. It's like breaking millions of windows. An estimated 75% of small engine repairs are due to ethanol and for many tools it's not worth it to repair, just buy a new mower every year. Bullish for Briggs and Stratton.
http://www.popularmechanics.com/home/reviews/outdoor-tools/can-boutique-fuel-save-small-engines-from-the-wear-and-tear-of-e10
Drain the fuel tank and run the engine until it dies.
Hmmm. I don't look at pure profit, I look at how much money the management makes from salary and stock. Also, check closely into money made in exploration, drilling, pipeline, trucking, refining, distribution, etc. I can make more money by contracting with myself to contruct a railroad than I can by building a railroad.
I think politicians like the thought of burning food in their cars while millions starve.
Millions of Arabs , for the moment. Stateside there are those USDA food stamp programs buying votes! More is better.
You can still buy pure, ethanol-free gas at Florida marinas.
Got to get some of that for my Bella Ducati. Italian divas sing so much nicer before they getta the alcohol inna them.
Official vehicle MPG stats are calculated using ethanol-free fuel too.
That would explain why owner experiences are 10-20% shy of advertised performance. For instance, F-150 forums are full with complaints. Someone I know received a rebate check from Kia as a class-action settlement for substantially below advertised MPH. In my own car, ethanol adulterated fuel dropped MPH from 24.8 down to 21, highway.
Modern cars tune the ignition timing based on detection of detonation (pinging) and emissions (O2 sensor). The lost performance is a great deal more than the 3% lower heat content. Reduced ignition advance to avoid detonation and emissions throws away power. That translates to lower MPG.
I believe a full analysis would show that use of ethanol in fuels is a net loss when the energy costs of producing ethanol are included and the lost performance is accounted for.
I just know the sound it makes when it takes an engine's life.
It's the worst on 2-cycle engines with a lot of rubber and plastic parts. Most of those are going away now too although the dirt bike guys (who like the superior acceleration) are still hanging on for now.
I wrote about this. I had a motor blow. The link:
http://brucekrasting.com/too-much-alcohol/
The intro went like this:
Too Much Alcohol
My very expensive Stihl “climbers” chainsaw won’t start. I yanked
on it till my arm hurt and then threw it in the back of the truck. I
toss in (the also expensive) back-pack blower that won’t start either. I
go to the repair place. The guy in the back, behind the grease-stained
counter has a grizzled look to him. He’s about 5’2”, 200 pounds, no hair
to speak of and chewing an old, unlit cigar. He looks at me and my
handful of machines and says, “What’s the matter, you can’t start em?”
I take this the wrong way and respond, “I’ve been starting these things for years. It ain’t me. It’s the damn machines!”
He eyes me and says, “Your problem is alcohol”.
Being pissed to begin with as a result of the sore arm, busted
machines and wasted time this took me over the top and I snapped back, “My drinking has nothing do with the fucking machines!”
He takes a second, grins, and comes back with, “No, I meant the alcohol in the gas. That’s why the motors won’t start. I see a dozen just like em every week”.
It's like the "new and improved gas cans" that spill gas everywhere you try to pour it. The result of some more brillant thinkers. I need to be in a state of zen when attempting to fuel my machines.
Yeah, pretty much...although it helps to drain out all the gas and store the things dry when not in use.
I’m thinking to myself that if the guy behind the greasy counter knows this, why don’t the bright folks in D.C.? Or do they know it and understand it, but they are doing it anyway because they have an axe to grind?
I'm pretty sure that every time ethanol ends up destroying a 2-cycle engine the folks at the EPA think: two birds, one stone!
yep, and the cost to fix most of those motors are just under the cost to buy a new one so you leave it w/ the guy, he fixes it and has it out for sale a day or two later. LOL.
Makes the corn lobby happy, and the "broken window" Keynesian's who will see broken engines as stimulus.
Also makes the planned obsolescence of U.S. auto manufacturers in the 70's look bush league.
Why no mention of Iowa? We're the ones lobbying so hard for it.
And Nebraska, and the other corn lobby states.
Even if the study shows it is net negative the corn lobby CONgressional members will trade votes, bribes, and hookers with fellow CONgressional members to keep their respective gravy trains running.
To hell with the citizens, food prices, and common sense.
Not to mention how damaging ethanol is to engines and things with engines in them. You had a great article on that previously, Bruce.
Got any power sports toys in the garage or side yard that don't get out enough? Gotta treat that gas or drain it....or burn it out the tailpipe.
I'm getting sick of having to replace the fuel lines and rebuild the carbs on my chainsaw, leaf blower and string trimmer every few years.
Buy aviation fuel for these power tools. That's what we do.
http://pure-gas.org/ www.buyrealgas.com
Lucky enough to have a station right up the road. I mark my non-ethanol cans 'NE' and use it for the bikes, Husky chainsaw, etc. Not cheap, but neither is my Husky.
Someone told me to add stabil. I don't know if it works, but I add it to my lawnmower gas even when it's fresh. They told me the problems with their small engines and tools practially disappeared when they started adding it.
It might help, but I don't think it stops the damage from the alcohol in ethanol.
http://forums.aaca.org/f143/sta-bil-ethanol-treatment-308472.html
Can you just show up at the local civil aviation terminal carrying a gas can?
Don't stupid, even planes don't just "show up and pump gas". They have to have access to the pump through the local Flight Operations person. At rural airports a simple friendly conversation will get you access. All economies are really local in the end, being nice about things or a jackass can have a big impact on your future prosperity. Just saying.
Gah
Yet, we continue to let government take more and more control over our lives.
Let? I don't think you understand the nature of the beast.
And we pay for it, to boot.
clusterfuck nation
"Welcome to America and its stupid politics."
no
it's
Welcome to America and its stupid public.
Welcome to America and its stupid public.
Public ?? You mean inhabitants...
This ain't no movie !
Exactly, a progressive "education" that makes sure all those being educated suffer severe cognative dissonance when the issue of accountability and consequences for bad behavior are concerned. They all worship Nature, yet ignore why Nature is so successful - built in accountability with real consequences for bad behavior (usually death in the natural world). God forbid we execute anyone for fraud that lead to people losing their life savings and starving. Morons.
Two of man's creations share a lot with what makes nature so successful : the free market and science.
Good intentions aren't selected for in evolution? That...doesn't portend well for the nanny state's dependents.
Humanity's tombstone will read: "Gee, it wasn't the thought that counted, after all."
And its bloated K-12 education system, a democrat and statist political machine with a side activity in educating future citizens. There is reason high school resembles the movie Grease. Priorities.
I resemble that remark!
DaddyO
"Nyuk, nyuk, nyuk."
Coach taught such a fun civics course though. We all got 10% on the semesters' grade for reciting the preamble to the Constitution, all together in a chorus, to the tune as given in those ABC Schoolhouse Rock videos we'd all seen amongst Saturday morning looney tunes and scooby doo and super friends cartoons.
If only "I'm just a bill" still worked that way. Currently the politburo votes on thousand page massive overhauls of giant segments of the economy or of law enforcement arrangements without reading them, hours or minutes after they hit the floor. This is from the most ethical congress ever, auto pen signed from the golf course or Hawaii or martha's vineyard with great personal satisfaction by the destroyer in chief.