Vinod Khosla Debunked: Ethanol is NOT the Answer
Posted by Robert Rapier on July 25, 2006 - 3:27pm
Who is Vinod Khosla?
When an influential person begins to affect energy policy decisions - decisions that will have a huge impact on all of our lives - we better take a critical look at the claims that person is pushing. You can't discuss ethanol for long with an ethanol proponent without having them mention the endorsement of Vinod Khosla. If you don't know who Khosla is, here are a couple of blurbs from his Wikipedia biography:
Vinod Khosla is an Indian American venture capitalist who is considered one of the most successful and influential personalities in Silicon Valley. He was one of the co-founders of Sun Microsystems and became a general partner of the venture capital firm Kleiner, Perkins, Caufield & Byers in 1986. In 2004 he formed Khosla Ventures.Vinod was featured on Dateline NBC on Sunday, May 7, 2006. He was discussing the practicality of the use of ethanol as a gasoline substitute. He is known to have invested heavily in ethanol companies, in hopes of widespread adoption. He cites Brazil as an example of a country who has totally ended their dependence on foreign oil.
I have previously made the case that Khosla’s claims don’t stand up to scrutiny. However, I recently got an e-mail from a reader who had watched a video presentation by Khosla. He had been referred to the video by a blog, where a poster wrote “this is actually starting to sound like a rational plan to me.” The presentation may be seen at:
The accompanying slides may be downloaded at:
Biofuels: Think outside the Barrel
In addition, another e-mail recently called my attention to a coast-to-coast road trip being fueled by E85:
In one of the blog entries from the trip, there is a conversation between the driver of the E85 car (Mark Pike), Tom Daschle, and Vinod Khosla. The conversation is archived at:
Sen. Tom Daschle & Vinod Khosla talk Ethanol
I documented my impressions of the exchange at:
For me, the most disturbing part of the exchange came when Mark Pike said: “If the technology is good enough for Mr. Khosla, it’s good enough for me. I know that guy has done his research, so I trust him. I will leave all of the scientific data and research to him.”
There we come to the crux of the matter: People trust that he knows what he is talking about. The Wikipedia biography says he is “successful and influential”. Make no mistake; he is influencing people in this ethanol debate, including political leaders. Khosla is convincing people that his projections are viable. Yet, are they carefully scrutinizing his claims? No, because they trust him. Yet claims like his, will dampen conservation efforts, and Americans will not be prepared for Peak Oil. After all, Khosla, a guy they trust, says we are going to produce enough ethanol to replace our oil imports.
Become a Billionaire in 3 Easy Steps
In fact, Khosla’s slide 78 shows very optimistic growth projections in all of the following areas: crop yield per acre, ethanol yield per ton, and acres of biomass planted. It shows cellulosic ethanol growing from 0 gallons produced in 2006 to 173 billion gallons produced in 2030. We will need that ethanol to get to our condos on the moon. Fortunately for us, he has cellulosic ethanol scaling up just as corn ethanol starts leveling off. The result is an exponential curve of ethanol production that he extends out to the year 2030 (slide 17, shown below), at which time he has the U.S. producing almost 200 billion gallons of ethanol (versus the current 4 billion gallons). Because after all, we all know that crops don’t fail, droughts don’t happen, and technology always delivers on its promises. That’s why I don’t worry about bird flu. I know a vaccine will be produced in plenty of time. Here are Khosla’s projections:
Figure 1: Vinod Khosla's Ethanol Projections
By the same logic, I can offer you an easy plan for becoming a billionaire in the year 2030. Here’s what you need to do. Increase your salary each year, increase the amount you save each year, and increase your return on investment each year. You will find that your wealth chart looks just like Khosla’s ethanol chart. Of course I could point out that it is extremely difficult to accomplish all of these things in practice, but then you might not buy my new book: “Become a Billionaire in 3 Easy Steps”.
The Debate Challenge
Before the debunking commences in earnest, I want to reiterate a debate challenge I made to Khosla. Following his essay at The Huffington Post entitled The Big Oil Companies Have Been Ripping Californians Off -- And Not Just at the Pump, I issued a challenge to Khosla to debate his claims. I repeat that challenge here. We can engage in a written debate (so claims can be referenced and verified) hosted at The Oil Drum, or at the venue of his choice. The focus will be on various ethanol claims that he has made. I will show that many of his claims are simply incorrect, and a lot of it is propaganda.
Debunking Selected Claims
Let’s focus on some specific claims that Khosla made in his presentation, and see if they hold up to scrutiny. If they don’t, then I want to ask why anyone takes his claims seriously, and why we are allowing him to influence energy policy. I want to ask those who encounter him to vigorously challenge him on his exuberant claims (and make sure he knows about the debate challenge). Because if he is wrong, and political leaders are betting that he is correct, we will be throwing good money away and wasting time while we could be going after real solutions.
During the video presentation, at the 3:50 mark Khosla makes the following claim:
Vinod Khosla: Brazil has replaced 40% of their petroleum use with ethanol already.So, is this true? No. As I documented in the article on ethanol that I wrote for Financial Sense:
According to BP’s recently released “Statistical Review of World Energy 2006”, Brazil consumed 664 million barrels of oil in 2005. In 2005, Brazil produced 4.8 billion gallons of ethanol, or 114 million barrels. However, a barrel of ethanol contains approximately 3.5 million BTUs, and a barrel of oil contains approximately 6 million BTUs. Therefore, 114 million barrels of ethanol only displaced 67 million barrels of oil, around 10% of Brazil’s oil consumption. In other words, Brazil’s energy independence miracle was 10% ethanol and 90% domestic crude oil production.Therefore this claim, despite being constantly repeated, is false. It presents a very misleading picture of Brazil committing to ethanol, and then farming their way to energy independence. In fact, they drilled their way to energy independence. It also doesn’t hurt that they use 1/7th of the per capita energy that the U.S. uses. If you note Khosla’s slide 4, you see the qualifier “for light cars and trucks”. That is an important qualifier (even though he didn’t mention it), but it still presents a misleading picture. According to a March 2006 presentation by the Brazilian Ministry of Mines and Energy, the actual breakdown of vehicle fuels in Brazil at the present time (by volume) is 53.9% diesel, 26.2% gasoline, 17% ethanol and 2.9% natural gas.
At the 5:10 mark, Khosla says “Unlike here, ethanol [in Brazil] has a dramatic reduction in greenhouse gases”. His slide 4 claims a 60-80% reduction of greenhouse gas emissions for Brazilian ethanol. Here he admits that ethanol in the U.S. does not provide a dramatic reduction in greenhouse gases. Why then, on slide 7, does he answer the question “Why Ethanol?” with “Significant Carbon Emission Reduction”? Did he lose track of what he said on slide 4? No, that appears not to be the case. I have heard him make the “significant reduction” claim before. It seems that he is basing this projection on his hope that cellulosic ethanol will deliver according his optimistic projections above. And if we allow him to influence policy, and cellulosic ethanol doesn’t deliver as promised? We are in deep trouble, as you all know.
At the 6:10 mark, he is talking about E85 in California. He says:
Vinod Khosla: We don’t have E85 pumps. The ethanol is there, the cars are there, we just don’t have any distribution because the oil companies won’t do it.
This one left me a bit speechless. The ethanol is there? The spot price of ethanol in California has recently hit $4 a gallon. You can see an 18-month price graph here. Here you have a fuel that is more expensive than gasoline (despite Khosla’s claim to the contrary) while delivering less energy. Why should this be? Because the ethanol supply is not really “there”; not in the quantities needed to justify E85 pumps. You could probably get more ethanol in California, while driving the prices even higher. And “oil companies won’t do it”? Give me a break, Mr. Khosla. You can’t provide enough ethanol to justify them. But I have an idea. You are a billionaire. Put a couple of your own E85 stations in. The oil companies can’t stop you. Based on the logic you have laid out, it will be like printing money. But you will have no scapegoat to blame when things don’t work out according to your unrealistic projections.
At the 6:30 mark he says:
Vinod Khosla: Even in the U.S., and this is a conservative number, ethanol costs - most of the plants I look at - costs are about $0.90 a gallon to produce. [In contrast, slide 5 says gasoline costs $1.60 a gallon to produce.] Compared to any price you can imagine for gasoline, down to about $35 a barrel, ethanol is cheaper.
This is really an extraordinary claim. Khosla is on the record complaining about record gasoline prices. He has used very inflammatory language in criticizing oil companies. He says you are being gouged and ripped off, and that Big Oil is lying to you. So what are we to make of this graph?
Figure 2: Historical Rack Price of Ethanol Versus Gasoline
Source: http://www.neo.state.ne.us/statshtml/66.html
Ethanol prices have been consistently higher than gasoline prices for 25 years. Let’s just look at the CBT closing from 7-21-06. Ethanol closed at $2.80 a gallon, and gasoline closed at $2.29 a gallon. (The ethanol companies get to sell their ethanol at $2.80, but the purchaser receives a $0.51/gallon credit in an attempt to bring it to parity with gasoline). According to my math, if ethanol producers are making ethanol for $0.90 a gallon, and selling ethanol for $2.80 a gallon, they are making a lot more per gallon than gasoline producers. So, who is ripping off whom? Why does Khosla insist that oil companies are gouging, but doesn’t say a word about what appears to be even worse gouging by ethanol companies? This reeks of hypocrisy, but perhaps it can be explained by referring back to Khosla’s Wikipedia biography: “He is known to have invested heavily in ethanol companies, in hopes of widespread adoption.”
Say what you want about me. I work for an oil company. You can suspect my motives all you want. But I acknowledge up front that gasoline should not be the basis of our future energy policy, and I acknowledge the problems from wide-scale use of fossil fuels. I advocate conservation and alternatives that make sense. And at the end of the day, I support my arguments. Khosla, on the other hand, is guilty of using some pretty unsavory tactics and making a lot of bald assertions in promoting ethanol (coincidentally, boosting his chances of making money).
Note that we are now just 7:00 into the video, and so far we have seen false claims, misinformation, and now hypocrisy. Need I go on? I have listened to the video presentation twice now, and this continues throughout the presentation. He presents facts that are fictitious, and he runs down oil companies every chance he gets in order to win support for his argument. I won’t address the entire presentation, but there are two more common arguments that he makes that warrant debunking. At the 21:30 mark, Khosla makes the following claim:
Vinod Khosla: Ethanol has a subsidy, but the farmer doesn’t get any of that. What I heard, is that well past midnight when this was being debated in the conference committee, the oil companies inserted 2 words into the language, calling this subsidy a blender’s credit. So the person who is blending it with gasoline gets it. All $2 billion of it last year was collected by the oil companies. Like they needed more money. It’s unfortunate, but that’s the way the system works. I talked to one of the senator’s aides who was in the conference room, and he said they got to 1 a.m., and were still negotiating, and oil guys were willing to stay there.
This one is chock full of lies, hearsay, and innuendos. First of all, what of the claim that “oil companies inserted 2 words into the language”? Doesn’t he realize that oil companies can’t insert language into a bill? Does Khosla realize that this blender’s credit has been in existence since 1980? Did he talk to a senator’s aide who was in the room 26 years ago when this bill was passed? Does he feel bad about passing on hearsay? (Wait until I tell everyone what I heard about Khosla).
Here’s the funny thing about the blender’s credit: Who does it really benefit? You answer that question by looking at the groups who are lobbying to keep the credit: Ethanol producers, farmers, lobbyists for both groups, and farm-state politicians. Oil companies have argued that the subsidy be ended. The credit is designed to make ethanol competitively priced with gasoline. If the blender is getting the credit, they can buy ethanol at $3.50 a gallon, sell it at $3.00, and break even. The credit is being passed on, which is the only reason E85 blends are ever less expensive than gasoline. (However, lately the price of ethanol has been so high that even the credit can’t bring the price into parity with gasoline). If the subsidy was going to the ethanol producers, then instead of selling the ethanol at $3.50 a gallon, they would have to drop the price to $3.00 a gallon in order to move product. In that case, they would pocket the subsidy. Either way, they made the same amount of money, and the cost to the oil companies was exactly the same. Yet Khosla has to paint this as one more way that the big, bad oil companies are ripping people off. I suppose we should just trust him.
At the 34:10 mark, Khosla brings up another old canard:
Vinod Khosla: Corn ethanol has 1.2 to 1.8 the energy compared to the energy in. By the way, petroleum is 0.8, so ethanol is about twice as good as petroleum. Because they always forget to mention that petroleum doesn’t produce a unit of energy out for every unit in. There’s transportation, there’s refining, there’s all those costs.
If Khosla’s credibility wasn’t already in tatters, then it should be now. The energy balance of corn ethanol is significantly worse than for gasoline. The 1.2 for ethanol versus 0.8 for petroleum is comparing apples and oranges. They are looking at an efficiency in the case of petroleum, but an EROEI in the case of ethanol. If you want to compare apples to apples, the EROEI for petroleum, even in a poor field, is 10/1 or better. Throw in the refining step, which is also 10/1, and you have an EROEI of 5/1 or better for gasoline, compared to 1.2 or so for corn ethanol. On the other hand, the efficiency of corn ethanol is 20-30% (versus the 80% he mentions for petroleum). If you doubt this, do a simple experiment. Let’s say you have 1 BTU of energy to invest. Tell me how many BTUs you will end up with if you invest into ethanol, versus investing into petroleum. Work the problem out, and you will see why Khosla’s claim, repeated by ethanol proponents everywhere, is completely bogus.
Something Smells Fishy
Let’s recap. Khosla says that ethanol is significantly cheaper to produce than gasoline, that Brazil has shown us the way, that there are “significant carbon emission reductions”, and oh, by the way, it has an energy balance twice as good as petroleum. Yet despite all of those supposed advantages, he is requesting legislation and funding an initiative in California, in order to level the playing field. Who is he kidding? Khosla is trying to hedge his bets. He invests in ethanol producers, and then tries to influence legislation to help out those producers. Yet with all of those claimed advantages, if Khosla believes what he is saying he should spend less time lobbying, and more time building his own cellulosic ethanol plants and E85 pumps. One wonders why he doesn’t. Seriously, if you had a product that is as good as claimed, would you spend any time lobbying for even more advantages? No, unless the product really isn’t as good as advertised.
My Position
I am a staunch advocate for energy independence. But the core problem is that we use far too much energy. We can legislate and mandate E85 all we want, but we can’t mandate it into existence. Forcing nation-wide adoption of ethanol makes about as much sense as mandating that all 50 states grow mangoes: Yeah, it could be done, but at what price? And is it sustainable?
Despite my harsh assessment of Khosla in this essay, I do believe that he deeply cares about energy independence. He is enthusiastic about his product, and charming in his delivery. I just believe he has let his enthusiasm (and possibly his investments) cloud his judgment. I would like to see him take a more critical examination of the claims he is repeating. His presentation slides were slick, but his research, as I documented in this essay, was shoddy. The only reason he has gotten away with it with so many people is because of his reputation, which was forged in an entirely different industry. If oil companies lobby against windfall profits taxes, they are “evil”, and “standing in the way of progress”. But Khosla is lobbying, and his efforts promise to put money in his pocket. Personally, I find this behavior unethical, especially when he criticizes the lobbying efforts of his opposition.
I strongly support heavily funding research into cellulosic ethanol. It has the potential, with some technological breakthroughs, of making a contribution toward energy independence. However, counting on it to deliver, while more viable options are pushed to the background, is incredibly foolish energy policy. This is too serious an issue to allow someone like Khosla, who is clearly misinformed (and has a vested financial interest), to dominate the debate. I will not quietly allow that to happen. None of us can afford to.
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Khosla did not do his homework.
Though an ethanol advocate, I do not see it as more than a niche fuel; like you I'm a big booster for geting alcohol out of biomass. (Sun chokes, also called jerusalem artichokes are my particular interest and area of expertise.)
One thing that puzzles me still (and seems also to puzzle you): VK is not stupid, nor is he a lazy man. Why then did he not do his homework? To me, this is very odd, but that is probably because there are some things I do not know about the man.
Tactically speaking, however, I think it is a mistake to question the man's integrity. Who knows, maybe he had a series of silent strokes and cannot any longer concentrate. Perhaps trusted subordinates lied to him. Who knows?
Thus, I question the relevance of the fact that if ethanol gets subsidies, then VK gets richer. He is already rich beyond the dreams of avarice, and to me it seems unlikely that further self-enrichment is his main motive.
He may simply be operating outside of his area of expertise. Engineers w/ PhDs are no less susceptible to cognitive dissonance than anyone else. As Paul Simon put it so succinctly, "Still a man hears what he want's to hear and disregards the rest."
It puzzles me as well. I am not sure I understand what he is really thinking. Part of it is surely what klee mentioned: "He is operating outside of his area of expertise." But this is exactly why his claims have to be challenged. If he convinces everyone that we are going to transition to ethanol, and politicians support this vision, we are in deep trouble. We are going to hit Peak Oil with absolutely no backup plan, and a main plan that can't deliver on its promises. Meanwhile, Khosla will shrug his shoulders and say "It's all Big Oil's fault".
Cheers,
RR
See below, Mr Bubble.
There is a personality type that despite great worldly success and many millions or billions of dollars, can not stop. Matt would say they have a high level of fitness and I would just label them obsessive-compulsive and very highly acculturated. These in themselves rest atop genetic success. Which is why I am not a rich man. They were, in the immortal words of Bruce Springsteen, Born to Run.
How boring is that? Where's the intellectual spirit? Learn new things -- see the world, understand it! Ah, that's the challenge.
Two things:
#1: I hope you guerilla press slam him as mentione above.
#2: Remember the crowd in any venue outside of TOD will be on his side. You're saying "hey crackheads, time to get off the pipe!!!" He's saying, "hey crackheads, time to switch to some 8-balls and new dealers!!!" Who's the good guy and who's the villian from the persective of the crowd? Keep in mind you work for (insert dark ominous drum beat) BIG OIL!!! . . . so obviously you're on the payroll.
In terms of normal cells or normal human existance, we're all cancer cells.
The fact that RR has been contacted suggests to me that Khosla is concerned about the situation. It indicates:
- RR's case is too compelling to ignore or discredit.
- These blogs have more influence than we realize.
And so... an excellent opportunity to present credible information and get MSM coverage has presented itself.It's a natural David vs. Goliath, speaking truth to power... story.
A rumble won't do.
The cinic in me says this is nothig else than a well-thought marketing operation to convince the public and the policy makers most of which understanding too litlle of science.
So I think just the opposite - he did his homework, but the homework was not on that subject you were assuming here.
Geologists, petroleum engineers, and even farmers know all too well, that no amount of trying is going to find oil where there is none nor grow a crop on rocks. So for those people who have been constrained in their professions by physical reality all of their careers can see the difficulties with ethanol production. (thank you RR for an excellent analysis). All farmers know about the capriciousness of the weather and the random unpredictability of nature. Most of our attempts to circumvent these problems have been to throw oil in some form at food production. Even the much vaunted GE crops really have only produced two basic new adaptations and one of those is simply to allow the plant to survive an oil-based herbicide!
Of course we are all products of our individual life history and I have been subjected to many, many team building courses over the years in which one of the principles instilled in me was `Assume Innocence' and look for the underlying reason.
The really big danger, as others have pointed out, is that Mr. Khosla has the ability to lead us down the wrong path thinking that we do not need to conserve and develop more energy-efficient transportation methods. Most of us(myself included) would prefer to keep driving our personal vehicles if we think that is an option and this is the danger.
Re: "physical world laws of nature"
Ooops!
On topic - IMO opportunistic VC like Mr.Khosla does not have the power to lead us down either the right or the wrong paths. I'm pretty sure the more or less wrong and right paths are already known pretty well within policy makers, but in order to be implemented a much more long-viewing leadership would be required. Until we get that we're going to see govts going around the problem with boondoggles like ethanol as a best case. The worst case would be going to wars...
On this I have some experience, and must disagree. Most very wealthy people I know (I used to be a high net worth broker) don't ever consider the fact that they have enough money for them and their families forever. Not only do they continue to invest, but the bar gets higher and higher. Its not about the money, its about the feelings one gets by the process of making the money, whether its $5 mil to $10 mil or $1 bil to $2 bil. There are execptions, but they are just that. Maybe Mr Khosla is immune to our societal signals of fitness, but that would be rare.
Its like driving backwards in an Avis rental car lot - you can go forwards but if you go backwards your tires burst.
I'm not talking millionaires or multimillionaires or even families with a paltry few billions. Take a look at the Bill Gates family or that of Warren Buffett--those are the magnitudes I'm talking about. Based on the limited sample of those I'm on a first name basis with (and of course this is a biased sample) not a single one gives a flying fig about money or the accumulation of greater wealth. After first five billion, most people just stop counting. The Buffett children are some of the nicest people in the world, and talk about naive: Until they went away to college, none of them knew that Dad was one of the richest people in the world; it had never ocurred to him to tell them, and none of them (Dad included) is interested in accumulating wealth for the sake of wealth.
Thus I think it is highly highly questionable to assert that VK is motivated (or primarily motivated) by the desire to accumulate more wealth.
Herewith is my WAG: I think he sees himself as a prophet and a "savior," and that is his primary motivation.
But I am still puzzled by his failure to do his homework--UNLESS (and here comes another WAG) he thinks he can create a self-fulfilling prophecy. This last conjecture makes sense, and I always like my conjectures to at least sound reasonable.
My personal view is that we all have dopamine (which led to resource acquisition and fitness in the past) amplitude meters -say from a scale of 1-10. Those that never really experience too much higher than a 3 are completely content to live in a small rural house and plant potatoes. Those that through, money, drugs, sex, wild experiences, travel, consumption, etc that have their amplitude turned up to a 7 or 8 will still be seeking 'more'. Its the wanting thats hurting society. I have nothing against Vinod Khosla (other than him being wrong and misleading people he looks like a sincere, caring fellow), but rich successful people CAN'T just turn this mental machinery off when they quit/retire/switch careers -and the thing that has been proven to produce dopamine in the past (your friends notwithstanding) is making money.
If Microsoft had "worked and played well with others" it would not be the company that it is.
If Buffet had played money games only to satisfy his own needs, he would have been out of day to day stuff at Berkshire Hathaway at least twenty years ago [he probably could have quit at the bottom of the great bear market in 1974 ... and never needed to look back. Incidentally, his father [a conservative] was IIRC a congressmen, so Warren was hardly under priveledged as a chils.
It very much irritates me that while both of these men are putting their money into trusts [which keeps them from being subject to death taxes] they advocate imposing death taxes on the estates of if not eh "little people" at least the "littler people." What gives with that bit of nonsense?
Maybe you are correct in asserting that there are more than a few of the very wealthy who see their role as being the saviors of the masses. No thanks, I'll take religion as religion and megolamania as a fact of life.
Funny, come to think of it, Lovins and his hydrogen scam haven't gotten much play on TOD, or maybe I just missed it.
http://www.rmi.org/sitepages/pid985.php
In fact, in this section:
3. Making hydrogen uses more energy than it yields, making it impractical.
he does the same bogus calculations showing how much more 'efficient' it is to produce hydrogen and use it in fuel cells than it is to produce gasoline. He also talks about the entire car fleet running on fuel cells. He is obviously a visionary like Khosla :-P
At the end of the day, it doesn't really matter what Khosla's motivation is. The fact is he is wrong and is just one of many people who are misleading the public. Too bad he has the blow horn.
Brazil has ended it's dependence on foreign oil because
Also, here. No doubt Brazil's consumption of oil is fairly low partly due to their sugar cane production. However, Petrobras is perhaps the leading deepwater or ultra-deepwater E&P company in the world. Their foreign oil dependency ended (for now) when they produced more than they used. I thought that was worth noting in light of Khosla's statements.This story fascinates me:
http://abcnews.go.com/International/wireStory?id=1875850&CMP=OTC-RSSFeeds0312
What are prospects for oil deep offshore in the Atlantic?
Are we to assume that as large as the Atlantic is, this was a one shot lucky deal by Brazil, or is it possible there is more offshore oil in the Atlantaic off the South American and central American coast?
Does anyone have Exploration prospects, or info on what other exploration has been done?
Roger Conner known to you as ThatsItImout
Even the Pentagon understands that biofuels are not an energy panacea. The March 2005 DoD Renewable Energy Assessment Final Report states that "biofuels, despite their dubious energy effectiveness, will grow considerably due to tax credits and government programs."
Given the strategic importance energy has to national security and the operations of the military, if there was significant viability for biofuels as a substantial replacement for fossil fuels, then the Pentagon would have been on the case like a bee on honey.
Taxpayers and suckers everywhere will be the ones left holding the bag on such a fool's gold enterprise.
... 53.9% diesel, 26.2% gasoline, 17% ethanol and 2.9% natural gas
RR, I read his 40% number as being 40% of petrol, ie gasoline. Doing the math: 17/(26.2 + 17) = 40%
I know that's where the number comes from, and you know it, but that isn't how it is presented. Listen to the presentation and hear what Khosla says. He said "40% of their petroleum use". This is not remotely factual.
In addition, the 17% ethanol includes hydrated ethanol. This lowers the ethanol number. Finally, the lower BTU value reduces the net energy number to something like 10%.
Finally, the 40% number has been repeated and passed on as if Brazil is fueling 40% of their energy needs with ethanol. That is what is being represented. The point is, that's not true. Saying that ethanol (volume) is 40% of gasoline volume would be true, but if someone is not trying to mislead they should point out that most vehicles don't run on gasoline.
Cheers,
RR
I've also understood that he was saying that Brazil is using 40% less gasoline on vehicles, even though I have to agree that he "cheated" when he didn't include trucks (that's where diesel comes from). However, I already knew a few more numbers (that I'd like to correct now) to come to that conclusion.
I have the National Energy Balance here, from the Ministry of Mines and Energy (if you know Portuguese, just google for "balanço energético nacional"). Preliminary data shows that petroleum consumption was around 620 million barrels of oil (everything here converted using 7,4 rate from ton petroleum equivalent to barrel oil equivalent).
While ethanol consumption seems to be something around 51 mbo, total sugar cane energy accounted for 221 mbo, because at least 150 mbo were produced from sugar cane bagasse for heating and electricity (sorry, I don't know where are the missing 20 mbo :-)). Only 1/3 of the energy in sugar cane goes to ethanol. The bagasse has another 35% of the energy (and includes bagasse from sugar production). The main result is that sugar cane accounts for 13,9% of the whole energy production. Biomass production (including sugarcane) accounts for 29,7% and renewable energy (including biomass) is around 44,7% of all the energy consumed in Brazil. Petroleum only accounts for 38,4% of the energy consumed and the figure is going down. There's no such thing as petroleum being 90% of the total energy consumption.
Concerning the "energy independence miracle", I've never seen any Brazilian say that ethanol was responsible for it. I've only seen it written in Wikipedia and repeated by a few Americans. If you'd asked me why I think Brazil is independent of foreing oil, I'd answer:
- 15% of the energy comes from hydric sources, the "number two" energy source in the country
- 13,9% of the energy comes from sugar cane, the future "number two" energy source in the country
- there are "plenty" of oil around and intelligent deep well drilling research and development was done
- Brazil consumes 1/10th of the energy US does
Also, I don't know how much energy is lost with hydrated ethyl alcohol, but more than half of the ethanol produced (60% IIRC) is anhydrous ethyl alcohol that is mixed with gasoline.Finaly there are some facts about cars:
I'm not worried either:
Vaccine Appears to Ward Off Bird Flu
Scientists develop bird flu vaccine
Bird flu vaccine mass production begins
For or against either side can make a case about ethanol and no one really can know for certain what will really happen. Neither extreme is likely.
Apples and oranges? I thought we were comparing ethanol to gasoline. IIRC, E85 has 30% less BTUs than gas, not the 42% implied by your numbers.
But BTUs aren't everything! Engines optimized for ethanol (eg Saab's Bio-Power) can have higher compression ratios and so produce more power/torque per BTU, in some cases resulting in a 15% improvement in mpg. However, I agree that EPA numbers for flex-fuel vehicles show 20% - 30% reduction in mpg. I can only assume (as I commented in another thread today) that US flex-fuel vehicles are optimized for gasoline and just have fuel system rubber/metal replaced with non-corrosive materials to handle ethanol.
It does have about 30% less than gas, but 42% less than petroleum. Gas is one of the lower BTU components of a barrel of oil. And the argument was that Brazil is displacing oil, so 42% is the correct number.
But BTUs aren't everything! Engines optimized for ethanol (eg Saab's Bio-Power) can have higher compression ratios and so produce more power/torque per BTU, in some cases resulting in a 15% improvement in mpg.
Which still means it gets 15% worse gas mileage than when running on gasoline. Khosla mentioned the Saab in his presentation, and I think the number he said was 18% worse gas mileage, instead of the standard 25-35%.
Cheers,
RR
However, let's do a mind experiment with that extra 20% horsepower (180hp E85 v 150hp gas). Reducing the 2 litre engine to 1.66 litres would give the same power on E85 as the 2 litre on gas. If the 2 litre gas consumption is, say, 30mpg combined then E85 would be 21mpg. E85 consumption for the 1.66 litre engine would be 21 x 2.0 / 1.66 = 25.3 mpg. In this scenario, the mpg cost for equivalent performance is 15.7%, a lot better than 30%.
Consider that Vinod is originally Indian so will have learned British English. Maybe there is some misunderstanding here caused by that?
Final points - ethanol doesn't have to be a perfect replacement energy-wise for automotive fuel to be enormously useful. Also, it is not correct to assume that just because a solution is superior it will succeed in the market without regulation. Markets routinely break and need fixing - look at the software industry for a good example of that (cough Windows) and as Vinod has seen this happen to Sun I'm sure he doesn't perceive pushing for ethanol friendly legislation whilst also promoting the product as superior to be a contradiction.
http://www.woodgas.com/Science1.pdf
If I am interpreting page 4 and figure 2 correctly, they found improved MPG, despite high energy density gasoline being diluted with lower energy density methanol!
You are merely singing more praises to our Glorious, Notorious Invisible Hand.
VK is a Venture Capitalist (sometimes called a vulture capitalist).
The VC business model is very simple.
- Invest early and at a high ROI ratio.
- Pump up the investment before it goes IPO
- Cash out at the IPO and run as far as you can away from the carnage that hits afterwards
VC's don't care about long term viability of the company or enterprise. The point is to get in early and get out with the loot before everyone else figures out what just happened.Like John Kerry, the public is going to buy into ethanol before they buy themselves out of it. Good post.
This is a completely unfair generalization. A lot of great technology and big companies have come to market because of VCs. Yes, they are hard-nosed business people. But the best of them are honest and blunt about what they think and don't fund stuff they don't believe in.
I agree that "some" VC's may actually be caring and well intentioned people. But overall, the business model is to maximize $RO$I --pure and simple.
It is that part that causes me to suspend belief in the "Markets will provide" theory. All too often, the "right" thing to do is not the most profitable thing to do, and the most profitable thing to do is not even close to being a right thing to do.
Firstly, not "all" businesses are "for profit" ones.
But more to the point, a VC firm is organized to raise a large lump of money from the wealithiest of investors and to quickly return to them a larger lump than what they would receive in the course of ordinary, broadly-diversified investments (i.e. stocks, bonds).
To this end, VC's are heavily specialized in one type of industry (electronics, software) than in others.
Vinod's speciality is computers.
Technology is not technology.
Each one is different.
By venturing out into the liquid fuels business, Vinod is entering an area in which he may not be as well versed as RR, and perhaps making an investment mistake due to lack of understanding --perhaps not.
Even if Vinod makes money for himself and his investors, that does not mean he is doing "good" for society as a whole. VC's are not in the business of doing good for society as a whole, just for themselves.
And sure I don't dispute that Vinod may have got it wrong or that VCs aren't charities, but it's wrong to imply that wanting to maximise ROI is somehow wrong or even capitalist - everybody wants to get the best result for their effort.
Suppose you go to a restaurant and you want to get the most bang for your efforts. Should you use (weight gained)/(weight of food ingested) as an indicator of what foods are "best" for you?
Now, often ROI is measured purely in terms of dollars and yes that can be destructive. But that's just a particular way of using the measurement. You could say this project gives the best happyness ROI, and this would be a fine usage of the term.
Come on now Mike.
You're a computer programmer right?
Somewhere in your definitions library there's got to be code like this:
Declare INVESTMENT in units of measurement (Default=Dollars);
Declare RETURN in units of measurement (Default=Dollars);
ROI =: RETURN/INVESTMENT
Print (ROI)
(What units of measure would you use for "happiness" and would it be per dollar invested or per other thing invested?)
Oil CEO. What got into you with that language?
First off, Alpha was swimming. As Sienfeld can tell you, there is a scientific law regarding swimming and shrinkage. You don't take a man's measure after he's been swimming.
As to my C++ skills --it's been a long long long time ago. Did someone say we can get free compilers on the Internet now? (I am sadly reduced these days to coding only MS Word VB for applications, if you can call that coding.)
To be honest, I've read Roberts analysis, and even agree that most of it is likely correct, and I still think Khosla is smart. What are the alternatives to ethanol, really?
- Powerdown. Last resort, people will really not want to do this and who can blame them.
- Big efficiency savings. They'll happen I'm sure but will they do more than offset the declines? Probably not. Especially not if we have 7-8% declines as seems increasingly likely.
- Electric cars. Hahahah. Even if the storage problem is cracked where does the electricity come from? We are barely able to keep the grid at capacity right now, let alone when people start plugging cars into the wall.
- Ethanol. It's backwards compatible. Efficient enough that combined with improved efficiency the lower milage is not a stop-ship problem. Cellulosic ethanol technologies actually do exist if not at industrial scales yet.
So if you have a few million to blow of all of those, the last one seems the best bet. Is it really surprising that he's talking up ethanol? Anybody who has been in software for some time will know the supreme value of backwards compatibility.Now are Khoslas numbers correct? Maybe so, maybe no. As I found out in the last economics thread you can get into arguments with people over such basic things as the definition of "money", so it wouldn't surprise me if some of the disagreements over figures boil down to something similar.
Every dollar that "we" spend towards building a CO2 generating infrastructure is one dollar less spent on building an emissions-reduced infra structure.
A number of posters here keep asking why TODders fail to understand that Global Warming (GW) is the bigger problem.
I guess the answer is because we "specialize" ... and in doing so, we develop a tunnel vision.
Yes, building a reliable electricity delivery system is a huge problem. (See this month's Scientific American.) Figuring out how to generate all that electricity is a huge problem.
These are problems we must face ... and overcome.
If we don't, GW will overcome us. PO pain is just a piss drop in the bucket compared to the devastation heading our way due to GW. Are we ready for Katrina II?
Our everyday actions tell me we are choosing, whether we realize it or not, massive dieoff. On the bright side, the planet will benefit from such a result and may be repair iteself in a few million years.
On the other hand, running EVs or PHEVs on unutilized base load would be better than oil based ICEs. I've seen estimate that 10% of the existing fleet could be replaced with this approach. Problem is that in our culture, there is no such thing as substitution; there is only addition. As long as growth is the dominant meme, there are no long term solutions.
Homer Simpson was right.
Both the Democrats & Republicans are controlled by alien invaders from outer space.
These plant like creatures require a green house environment for comfortable living.
They are using our capitalist system to Terra-reform the Earth.
There is no War on Terror.
It is a War on "Terra".
Though mine use Ice, And they did give a warning, And we understood it, to many layers in the story to tell you about. The deserts are great melting stations for iceburgs though.
AH! Science fiction can just about solve all our problems just getting everyone to read and think it's true that is the problem.
Urban Rail could be a significant step towards reducing greenhouse emissions. EVs will not be.
Electric freight RRs will use roughly 1/18th to 1/20th the BTUs that 18 wheelers use today per ton-mile.
a distributed DC grid
where cars loan out their storage subsystems
when not using those for themselves?
I.e. like when parked and hooked to a solar panel overhead?
Good idea!
Folks, applaud, there is a genius among us.
Kind of like a ditributed hard drive or CPU system where idling computers share out their slack disk storage space or slack CPU bandwidth to the network. I think Sun uses such a system in their engineering workstations.
What would the operating voltage be ?
Remember, one size fits all. No voltage tranaforming allowed.
600 V DC ?
High enough to oeprate a car with (it will kill you if you short the battery).
Truely MASSIVE wires required to transmit even minimal power with (say enough to operate 10 four ton air conditioners + 10 TVs plus 10 computers and 3 kW of lighting) would rake anbout 500 mcm wire ( first guess). And that wire would be hot.
All homes required to be rewired OR we have dual transmittion grids; one AC (500,000 V to 120 V AC) and one DC (all 600 V DC ?).
Kidding of course.
No one said that DC grid means no transforming allowed and one standard voltage everywhere and that we would overnight get rid of our 60Hz AC antennas. AC has it pros and cons, and so does DC. We waste enormous amounts of energy in this country converting AC to DC for every computer, TV, radio, etc. AC cannot be directly stored in an electrochemical battery. DC can. Photovoltaic arrays output DC, not AC.
Right now ethanol looks like a far better bet than electric cars, just on the spare capacity and storage factors alone.
there is tremendous slack in our system.
that does not mean the slack can power our transportation system.
BTW, I work for an energy company. We make control room software to handle real-time operation of the electric grid. I'll go as deep as you want on this one.
I think he was saying; millions of cars whose rechargeable batteries and ultra-capacitors will sit unused most of the day --so why not loan out their power smoothing abilities? --in a distributed grid system, not a centralized one.
The conventional electric grid system is centralized. So you have to pump maximum amps through your I^2*R electric heaters (aka transmission wires) just when its the hottest part of the day, this leading to transformer burnouts and wire sag.
In a distributed system, there is less current concentration and hence less I^2*R losses and less wasteful heating of wires.
This all kind of gets back to the original debate between Edison and Westinghouse/Stienmetz on DC versus AC power distribution. Westinghouse won then. But maybe Edison wasn't so wrong after all?
I learned about V2G at Green Car Congress. Use the links and learn.
You definitely got me thinking about how to work up the basic idea. Who says it only has to be the battery that is put out on loan for use by the grid?
I don't like to throw away ideas too quickly. First we play with them a bit to see where they might go. All too often people discard ideas without realizing it may lead to something bigger. Not sure where this one will go --but it is intriguing.
Your proposed solution is almost Rube Goldbergish in it's complexity.
A far, far, far easier change would work better.
Reduce demand through efficiency (ban instant on TVs, etc,, higher efficiency air conditioners (Bush cutback Clinton proposed minimum SEER for a/c from 13 to 12), etc.) and install thicker aluminum wites and higher capacity transformers where needed.
There is no shortage of Uranium on the planet and actually we typically generate more total energy in the GRID than we consume in petrolium. Here in Australia the ratio is approximately 70:30 (GRID:transport). Add to that that electric vehicals are at least 4 times more efficient than standard autos and you see that GRID supplied energy for electric cars adds only about 15% extra load.
Nuclear Energy can really help here.
We simply have not developed technology (geothermal) for tapping into that heat.
Some believe that the center of the Earth is one giant fission pile due to the more massive metal elements (uranium) sinking towards and collecting near the core.
Just goes to show how important it is to have the dissection that one finds on TOD.
Tad Patzek Interview:
http://gog2g.com/2006/07/10/my-indepth-interview-with-tad-patzek.aspx
David Pimentel Interview:
http://gog2g.com/2006/07/13/my-interview-with-david-pimentel.aspx
VINOD KHOSLA Responds:
http://gog2g.com/2006/07/14/vinod-khosla-responds.aspx
David Pimentels Response:
http://gog2g.com/2006/07/19/david-pimentel-has-something-to-say.aspx
Fellow Bloggers Response to David Pimentel:
http://gog2g.com/2006/07/20/a-fellow-bloggers-indepth-response-to-david-pimentel.aspx
More can be found at http://www.GoG2G.com
As is most gasoline. That's why comparing spot to spot is a good comparison. He is promising that ethanol costs less to produce, but ethanol is definitely being sold for more than gasoline by the ethanol producers. Ethanol producers are making larger profit margins by far.
Cheers,
RR
Re: "It shows cellulosic ethanol growing from 0 gallons produced in 2006 to 173 billion gallons produced in 2030"
If I came out in a post and made a claim like that, I would be laughed off the website. As I review your post, the conclusion that this man is a complete charlatan can not be avoided.
If I came out in a post and made a claim like that, I would be laughed off the website. As I review your post, the conclusion that this man is a complete charlatan can not be avoided.
That's why I included it. I was just astounded that someone would scale up a bench scale project from 0 gallons to essentially displacing the major fraction of our fuel needs. Note the smooth exponential growth. I could literally use the same argument to show that starting from zero, you can become a billionaire in 20 years.
Exponential growth is not sustainable, and exponential growth of a process that has exactly zero commercial plants is ridiculous.
Cheers,
RR
Let's see. How many gallons per acre of corn?
Numbers Numbers!! Where are the real numbers? Oh yes I know where they are. In my latest Book of Fiction.
Yay!! We are saved. 11 Million Barrels a Day of Joy Go Juice!!
Drinks on the House!
Sarcasism off***
Using these figures, Brazil would need to plant 68.7 million hectares to produce this quantity from sugar cane using current technology. This would require 12.5 times the amount of land currently in use for sugar and ethanol production.
Worldwatch Institute claims that there are 100 million hectares with appropriate conditions with an additional 20 million becoming available as cattle needs decrease.
Presumably cellulose-based production would require less land.
I am not making a statement regarding plausibility. You asked for numbers, so I gave you what I got.
http://www.brazilianchamber.org.uk/documents/articles/braziliancaseEthano.ppt
Brazil claims to be able to provide 10% of OECD gasoline use (presumably by volume - so say 7% by BTU) using 14.4 million hectares, or current sugarcane area plus pasture area. Or 10% of global gasoline use with the amount of land currently planted with soy.
For some cellulose comparisons, the same presentation claims a 78% greater yield from cane with one hectare producing 12.85 liters of ethanol rather than the current 7.2 liters.
The presentation is highly informative. I recommend it.
By the way, I agree with RR that grain ethanol is a dead issue and a subsidy whore. I also agree that petroleum has played a greater role in Brazilian energy independence than ethanol.
But unless we think finding vast sources of new petroleum is a likely scenario, it seems to make sense to get past these level one type issues.
Ethanol from sugar cane in Brazil and other tropical countries has the potential to provide a significant offset to declining oil resource.
Whether a car runs on electricity, CTL, BTL, or even hydrogen doesn't change the energy equation much. It still takes X BTU's or joules to move 2500 pounds along on 4 wheels.
It seems to me the question really is: what is an appropriate gross energy budget? How many BTU's should we allocate to move an individual from A to B. Multiply that by the numbers of people to be moved and see whether there is enough coal, or anything else, to do that. And then ascertain whether we can live with the GHG's that will certainly accompany that calculation.
I use coal, because there is a notion that one can recharge via the grid at night for 10 cents and therefore it's a good solution. But the energy to move the individual, whether using electric or ICE power isn't breath-takingly different.
So we need to get up to 60,000 feet and look down. There are 6 billion people, probably about a billion who are actively using fossil fuel locomotion. What do we have that divides by a billion users and makes geologic, meteorologic and economic sense.
Hint: it isn't cars. That's a level one issue.
I said that: "Ethanol from sugar cane in Brazil and other tropical countries has the potential to provide a significant offset to declining oil resource.".
The GHG implications alone are enough to embrace those biofuels that are viable - the main ones at this point seem to be sugar cane to ethanol and palm oil to biodiesel - both from the tropics.
Khoslas claims on the google.edu, as youve pointed out are shoddy, so I cant respect the conclusions. But reading between the lines, he clearly is betting that cellulosic will be the transition technology, (not corn). What can you say about current progress in this area? Havent there been numerous jump starts then setbacks for last 25 years? Is Iogen up to promised capacity yet of 6,200 barrels per year? (1 million litres). Their website hasnt changed recently.
Its a small sample size, but doesnt paint too promising a picture of cellulosic, at least on a large scale
Termites digest lignin hard wood. Lots of ruminant animals can digest cellulosic plant stems.
This is one of the problems in the debate. Too many generalities. Cellulosic ethanol from switch grass will be a different process than cellulosic ethanol from poplar trees. Different proportions of lignin in the two raw materials. Design of one plant won't work for the other feedstock.
As RR has pointed out in his rebuttal. The devil is in the details and people haven't sorted them all out yet.
If somebody has primary sources that conflict with my understanding of the biology here, I'd be interested in hearing about them.
(sarcasm off)
Aha! There's the solution to using cellulosic plants as a fuel for transportation: horses. It certainly works, it has been done in relatively large scale before, and it needs little fossil fuel input. Doesn't scale up to the ridiculous levels we are using petroleum nowadays, but a partial solution anyway.
Perhaps we could use our "little grey cells" to solve our problems like Poirot did. All we know how to use is brute force.
- use solid biomass for direct burning
- use the heat thus generated for home heating (displacing oil or natural gas), or:
- use the heat for generating electricity (via steam), or, better:
- use the heat to generate electricity and district heating (co-generation)
- use the thus saved oil and gas for transportation, and
- work hard to both make vehicles more efficient and:
- work hard to reduce the need for SOV transportation, via land use patterns, car pooling, public transport, etc.
But I guess all this is too low-tech for VCs.Another way of saying this is that ethanol distilleries capture most economies of scale very quickly; a quite small plant is almost as efficient as a monster-huge-megapolluter.
I know diddly squat about F-T, except that it has been around a long time and it works. What about economies of scale? Can a, for example, one million dollar F-T plant be economically viable? I have no idea, but this Enquiring Mind wants to know.
This is true, only as the total energy extraction/distribution of society is increasing. As it starts decreasing, quality corrected EROEI matters immensely. And EROEI isnt totally about energy, -there are other criteria (like soil, land, labor, water, etc) that must be scaled up with lower net energy products.
Joseph Tainter has shown that societies (and other organisms) collapse after losses of net energy gain(equivalent to lower societal EROEI)
We can only turn corn and coal into fuel for so long - the low EROEI of ethanol isnt exactly the issue in any case - the issue is that society is run on much higher EROEI than 1.2:1. 2000 years ago a technology producing 1.2:1 would have made society rich - today it shuts society down, unless its only a fraction of the energy mix and has no other external costs. Corn ethanol has MANY external costs.
If you want and apple to apples comparison from Shpouri's numbers get rid of the coproduct credit and compare this result, about 1.06 from the latest estimate I've seen, to the various efficiencies they quote for the inputs, ranging from 0.80 for gasoline, 0.84 for diesel, to 0.94 for natural gas. Since natural gas and diesel are the main sources of inputs used the weighted average should be about 0.9. Comparing them this way results in ethanol yielding about 20% more energy about in the form of liquid fuel, which was the point of the whole exercise, from the fossil fuels used. It also implys that 85% of the energy yeild is from fossil fuels. Of course adding the energy required to build the machinery to the estimate or using Pimintel's numbers would eliminate the most of the gains or end up with a loss compared to traditional fossil fuels.
That comparison does not imply anything about the EROEI. If you want the EROEI a I believe a quick way to estimate it would be to compare the energy ratios incluidg coproduct quoted in the various papers to the energy ratios for the various inputs, ranging from 0.8 for gasoline to 0.94 for natural gas. This would range from a high of 1.67/0.9 or ~1.8 for Shapouri's latest paper down to less than 1 for Pimintel's.
http://www.ethanol-gec.org/netenergy/NEYShapouri.htm
This is why I don't believe the energy ratio from the various papers is the EROEI and that comparing it to the 0.8 for gasoline and 0.94 for natural gas is an apples to apples comparison.
That's still not an apples to apples comparison. It looks only at the refining step, and ignores the oil extraction step.
Here is an easy way to visualize. Let's say you have 1 BTU to invest. Will you end up with more usable energy by investing in gasoline production, or ethanol production? If you work the problem correctly, gasoline wins by at least a factor of 4.
Cheers,
RR
I'm curious how much of the economy is currently devoted to producing energy? How much would that have to increase as the EROIE falls, for example, if we were producing energy with an EROEI of 2:1 would it have to double since we would only be able to use half of what was produced?
That's something right up thelastsasquatch's alley. He has some pretty good arguments on this subject, if he is still around.
Cheers,
RR
You know, that sounds like something a corn farmer might say. How go the crops?
I want you to understand something. My crusade is not against ethanol. It is against junk science, bogus claims, and bad energy policy. I have advocated E3 Biofuels' ethanol process. I think their plant should be a model for all ethanol plants. I believe we should aggressively fund ethanol research. I wish that ethanol would succeed. We need for cellulosic ethanol to be successful. But wishing isn't the same as getting. We have to scrutinize the claims of those who wish, else we may be led down a dead-end road.
Serious question: What possible motive do you think I might have for a crusade against ethanol?
EROEI is irrelavent in the real world. It is a bizarre concept from true cost economics that completely ignores the relative costs of various forms of energy.
You are dead wrong about that. The only reason you can get away with a low EROEI process today is because the fossil fuels driving the process have been relatively cheap, and subsidies have helped mask the inefficiencies. But as fossil fuels deplete, EROEI will become ever more important, because low EROEI processes won't be able to drive our society. The response by thelastsasquatch was right on the money. The low EROEI of ethanol predicts big trouble down the road as we attempt to transition from a much higher EROEI fuel.
There is no production system in the entire world that I know of that opperates on the the basis of EROEI.
In fact, they all do, they just don't call it EROEI. Many processes are uneconomic due to high energy costs. What this often means is that the EROEI is too low to allow the process to be economic. This would be the case today with ethanol, but the subsidies mask the low EROEI. The market has been distorted.
I submit that if one were operated if such a way it would shortly go bankrupt. Hopefully, someday even RR will be able to figure this out.
If someone doesn't understand the importance of EROEI, then they may starve to death post-peak. You can only get away with the economic argument until fossil fuel prices really skyrocket. This will happen when we are clearly beyond peak. Your energy costs will skyrocket. Why? Poor EROEI. Those with a better EROEI will be more insulated. If you prefer to think of this in terms of energy costs, be my guest. But the key to which processes will survive will be defined by EROEI.
Cheers,
RR
But when the inputs are very similar to the outputs, e.g. when it takes diesel to extract oil, then, yes, I agree with you that EROEI matters a great deal. In fact, I submit that this type of situation leads not only to poor economic value but also to "cost-push" inflation. The Sprott Asset Management report westexas referenced last week discusses this:
http://www.sprott.com/pdf/marketsataglance/07-2006.pdf
Regarding VK, two thoughts. First, my strategy if I were him would be to try to co-opt you. Don't be surprised if you are invited to be on an advisory board, complete with lucrative stock option package, etc. This will be his fallback position after you turn down his offer of full employment. Second, now that your essay has been published on the web, it will be forever out there for potential investors to consider during their due diligence. This is a good thing.
Forgive me if you already covered this elsewhere, but what exactly is Khosla doing? Is he starting his own ethanol firm, is it a new venture capital fund that will invest in several ethanol firms, or is it something else completely?
My understanding is that he has invested in Pacific Ethanol, and is also backing some other ethanol ventures.
Cheers,
RR
"We observe dog-eat-dog growth competition every time a new vegetation colonizing a bare field where the immediate survival is first placed on rapid expansion to cover the available energy receiving surfaces. The early growth ecosystems put out weeds of poor structure and quality, which are wasteful in their energy-capturing efficiencies, but effective in getting growth even though the structures are not long lasting.
Most recently, modern communities of man have experienced two hundred years of colonizing growth, expanding to new energy sources such as fossil fuels, new agricultural lands, and other special energy sources. Western culture, and more recently, Eastern and Third World cultures, are locked into a mode of belief in growth as necessary to survival. "Grow or perish" is what Lotka's principle requires, but only during periods when there are energy sources that are not yet tapped."
Systems in nature are known that shift from fast growth to steady state gradually with programmatic substitutions, but other instances are known in which the shift is marked by total crash and destruction of the growth system before the emergence of the succeeding steady state regime.
The true value of energy to society is net energy, which is that after the energy costs of getting and concentrating that energy are subtracted. For example:
A cheetah can't spend in the long run more energy on getting in its preys than he gets from them.
Lotka's principle / Maximum Power Principle: systems (economies, ecosystems, etc) win and dominate that maximize their useful total power from all sources and flexibly distribute this power toward needs affecting survival.
When I was in college I worked as a tech in the same department (Environ Eng) with him - my lab was across the hall from his office. His ecological methodologies offer great insights into many social questions. I worked with him on modeling warfare, for example. The great wars of the 20th century are the result of excess energy, for example.
He also worked closely with one of my favorite professors in the nuclear engineering department. We modeled a number of energy production systems, looking at EROEI. Nuclear came out looking pretty good - that's kept me going through nuclear's lean years.
Wish I could find more of his books.
As a physicist, I can tell you that the ONLY production system in the world that matters operates on EROEI: all LIFE on earth. Guess what? All physical systems are subject to the laws of thermodynamics. In the end, net energy is the only thing that matters.
Why do I have the feeling I'm wasting my breath preaching to this guy?
From those of us who understand the inside joke, kudos.
Attractive prospects remain either some energy efficiency products, IT applications reducing costs of existing operations, and corporate welfare opportunities.
Ethanol is an example of the latter so the VC front man is out puffing it with the public to make sure the tax dollars flow.
Khosla has plenty of money and fame and seems willing to exploit his reputation at what will be probably at some eventual cost to his political capital.
He's not a total waste - he has come out in support of nuclear power. Still, workstations and energy systems are apples and oranges - the "appeal to authority" argument does not convince in this case.
Recent chart of Pacific Ethanol
Cheers,
RR
I hope you'll emphasize this point.
Right now there are many entreperneur wanna-be's that would love to be in your shoes.
Go for it.
Make sure to have your 30 second elevator pitch ready.
He also sent a draft of a paper he is working on. I have skimmed it, and it repeats the claim the producing ethanol is much more efficient than producing gasoline.
Cheers,
RR
Keep us posted please.
It is interesting to see this through the eyes of a VC.
Assuming of course that he tells us a truth.
I suggest that TOD is not an appropriate forum for racist leanings. Thanks for keeping it on the low down in the future.
Thank you for that, much appreciated.
And fleam, there is no "Indian" accent, much as there is no "European" accent. A Greek speaking English would sound totally different from a Norwegian speaking English. Likewise, the accents of the peoples (note the term "peoples") of India are very much influenced by their mother tongue. Also, there is no race that can be denoted "Indian", because India is peopled by almost all the major racial classifications - Caucosoid, Mongoloid and Negritoid - and everything in between.
Solar may generate far more energy but how to get it into a car? That is the hard part. Even if you envision a massive shift to light rail or whatever, we still have fleets of millions of cars out there that aren't simply going to disappear. Any transition would take decades at best.
So, ethanol still seems like the best bet even though it's less efficient than solar.
Nobel prize winning chemist George Olah has a book that details all the ways that this is done ("Beyond Oil and Gas: The Methanol Economy"). He selects methanol as the best liquid fuel for a variety of reasons.
Technology Review has a short interview with him at The Methanol Economy where you can read the highlights his proposals.
Rat
Better to stick to having him defend his proposals than open up the debate to your alternative...
In other words, your assertions about solar are just as unfounded (or worst) than his assertions about ethanol.
Solar works, is incredibly efficient relative to alternatives, and we have barely scratched the surface of its potential. Ethanol, on the other hand, won't come close to meeting Khosla's projections. He is betting the farm on cellulosic, which unlike solar, is unproven.
I think a move to local solar combined with PHEVs is the only option that has a chance of replacing a significant fraction of our transportation needs.
Cheers,
RR
BTW, whatever happened to biodiesel? It seems the discussion has been drowned out by all the noise about ethanol. Do you still think it's the "King of Alternative Fuels," as you wrote in your blog?
--Thanks
Cheers,
RR
I dispute the "incresibly efficient compared to alternatives.
Current Wind technology is far ahead of current solar technology for a wholesale society wide conversion. Enough so that wind can bear the burden (IMHO) of a continent wide grid and pumped (air & hydro) storage vs. most local applications of solar (PV & thermal).
We also have unexploited hydro, geothermal, and biomass. Not enough for a society wide conversion, but very well worth doing !
OTOH, solar water heating is a "no brainer" almost everywhere (heat pump water heating is better in selected areas or a combo) and solar space heating has promise in many areas.
At current technology, solar electric is a niche product. IMO, wind holds the major promise.
I question this but do not have enough data to make a generalization.
How does one rank conservation investments vs. substitution/efficiency (i.e. electric rail) investments ?
It depends is perhaps the bast answer.
Is it better to
- add attic insulation and put in triple pane low E windows, and then use the NG saved for transportation (directly is probably better vs. NG to Liquids) or
- Electrify freight rail and than add gov't incentives to freee market incentives to get freight to take rail instead of truck or
- Build more electric Urban Rail ?
IMO. ALL of the Above is the correct answer. but I am hard pressed to say, in general, which is best. Buying CFLs is probably the single best use of investment $. But buying more rolling stock for existing, at capacity Urban Rail lines is probably just as good. (Hiawatha Line, add 33% capacity for 7% more capital and 5% more operating expense is an example with good data).So I question your statement, but cannot clearly contradict it.
Once you've made GM's bet, though, you certainly want to encourage others to invest their capital in all sorts of liquid-fuel schemes: corn ethanol, cellulosic ethanol, coal-to-liquids, tar sands and oil shale, etc.
I think its a good technology for local energy production near the sources of cellulose even better production of syngas for chemical synthesis. But no way is it a replacement for fossil fuels. I'm sure if it was easy mother nature would have made it far easier for animal/bacteria to digest cellulose. Instead there is a damned good reason its hard.
And if we did come up with a super bug that was hardy and could digest cellulose esp in a ligin matrix are we sure we want that spewing out into the environment ?
Talk about playing with fire.
I'm a big techno geek but I have no desire to destroy the earth so someone can drive a SUV.
Here are mother natures rules.
1.) Don't blow up atomic bombs all over the planet.
2.) Don't create a super bug that eats trees.
3.) Fill the air with C02 and you will be spanked.
I have always wondered when we humans were going to make a mess of things and really screw up. Hope it's not this week!
I just printed out a bunch of Short Stories for my editor.
If you are a collector of "end of world" scenarios (as I am - and yes I admit I'm sick) and haven't read it already, check out "Oryx and Crake" by Margaret Atwood. Absolutely chilling. Bioengineering combined with a socially ill society and, voila, end of the human race.
David
If you don't think the oil industry or any number of other industries with enough money can write legislation, you are completely naive about how our government works.
I know exactly how government works. I have been around lobbyists and such before. They attempt to influence bills. They may try to buy legislators. But that aren't sitting in committee at 1 a.m. inserting language into a bill. That's a preposterous claim.
Cheers,
RR
No, they meeting in dark smoke filled rooms at 1 pm at Cheney's task force meetings doing it.
I cannot speak for congress, but I used to be in government contracting and I know who wrote many of the specifications that were used. Magically, documents land on your desk, unsigned. How convenient.
RR,
If he accepts your challenge, I hope you guerrilla press slam his ass.* Here is a tutorial in case you're rusty:
[http://www.youtube.com/watch?v=87YMfI2_LyA&search=ultimate%20warrior]
*intellectually speaking, that is.
Cheers,
RR
I could never join the "everything is all right club." My personality is too blunt and my mouth far too big and beyond my ability to control for that. Imagine me saying something like "sure everything is all right . . . ahahah. . . but yee ahah . . . if your ass is Halliburton, beyootch!!!"
However, I could be persuaded to join the "Shut the f--k up and go away club." But it would cost several million at the least. That would be enough for me to set my parents, my sister, and me and my two wives* on some prime arable land in the mendocino area with a series of delux off-the-grid yurts plus enough I could stop working and this focus on getting homestead as self-sufficient as possible. Along with setting up a business or two on the land: maybe a bicycle shop and an alt-medicine set up.
I'm sure others would say, "I would never sell out." I call bullshit on that. EVERY MAN has his price. Most simply won't admit it.
*two wives have not yet been found, as of this writing.
For the humor impaired, Khosla didn't ask my price. He said he will offer me the chance to make my arguments to him and change his mind. But I am afraid he is in far too deep to publicly change his stance, even if I do convince him. I am making a short laundry list of objections to his arguments, I will let him review it, and then we will speak on the phone. I will reiterate my desire to hash this out in an open debate, because it is public opinion that I want to influence. I want to help a few more people become Peak Oil aware.
Cheers,
RR
Me: "Well, I'm not really looking to do that . . ."
Big Oil/NSA rep/Friend of Dick Cheney: "What if we paid you $3,000,000?"
Me: "404 message is already up boys!"
A few days later:
Me: "yeah, the site is down folks. . ."
TOD poster: "Matt you sold out you SOB"
Me: "Kiss my ass, me and my three wives* are sitting on 20 acres of corn and squash while you're sweltering in some suburban hellhole sucka!!!"
I'm not motivated by materialsim myself. I have no car, few posssession not related to my business (like my laptop) and the first thing people say upon entering my apartment is "wow, spartan . . ." (seriously people always say it) but I am motivated by my desire to escape suburbia and doing that does require money, at least if you want to do it the right way.
*figured I'd add another one just for the heck of it.
Should be easy ...
What would persuade him to reverse his stance?
And get that in writing, in advance of any further debate.
In my lifetime I have done aproximately 31,141 RSTs (Really Stupid Things). One of the Very Dumbest (VD) came in 1957 when I had an opportunity to buy a section (640 acres) of cut-over timberland not far from the Mendocino coast. But I did not like the price of $100 an acre and put in a lower offer--which was rejected. Well, you lose a few, and then you lose a few more . . . .
I think there may still be some steep and dry cut-over timberland in that area that would be great for sheep or goats--but not for prime agricultural land by any stretch of the imagination. Most of the land up in the hills above Mendocino is awfully steep--but suitable for fortifications and polygonous communes for sure.
Think goats.
Let's think a bit here. You don't get to be the "alpha male" by telling people the EXACT spot where you're setting up your apocalyp . . I mean homestead.
but it would be in the norcal area as that is where all my friends and family are loacted.
BTW, by sheer happenstance, more than fifty years ago I stumbled upon the best tap water in Calif. and possibly the second best in the world.
Dunsmuir, CA.
Old railway/logging town that hardly anybody has ever heard of--unbelievably good water from snow melt onto (I think) granite. No filtration, no aeration, no nothin' but the water is so good that I cannot do it justice in words.
If you want the world's best tap water, go to Buhl, Minnesota, an iron mining ghost town where few live in what used to be a bustling little city. They jug their tap water and send it hundreds or thousands of miles--tastes better than anything the Frogs put in bottles, and by a considerable margin. Also, in blindfolded tests, it tends to beat all other waters, from whatever sources. Comes from ancient and deep Pleistocene deposits, and apparently there is a whole lot the good stuff left.
No taste?
Speak for yourself;-)
Here I have to support Don, but what does this have to do with Peak Oil???
The Dunsmuir Metam Sodium Spill Revisited
July, 1997
This toxic nightmare began Sunday, July 14th. 1991 at 9:50 P.M. when a 97-car Southern Pacific train lurched while rounding the Cantara loop in the upper Sacramento River gorge. Seven tankers suddenly derailed and plunged from the river trestle. One landed in the middle of the Sacramento River in about two feet of water. The conductor first checked to see if the tanker's contents were listed as hazardous. Finding no reason for concern, he and the engineer went to survey the damage but were put off by the poisonous smell. They radioed headquarters that they were "getting the hell out of there!" Uncoupling the engine, they hurried on to Mt. Shasta, the next town up the line. The tanker, left lying on its side, slowly leaked nineteen thousand gallons of the pesticide, metam sodium, into one of the more well known, pristine wild trout streams in California. It wasn't until early the next morning that the full extent of this tragedy started to materialize.
http://www.sonomacountyfreepress.com/reaction/a_toxic_nightmare.html
http://www.huffingtonpost.com/vinod-khosla/big-oils-big-profits-an_b_24162.html
http://www.washingtonpost.com/wp-dyn/content/article/2006/07/25/AR2006072501301.html
Lack of investment, speculation, and risk premia are the only factors discussed.....
The food versus fuel debate is going to really heat up in the near future.
Cheers,
RR
www.freecharts.com
We are going to see the same competition for resources in the fossil fuel realm, because of the demand for LTF's, as companies move to the endpoints of the fossil fuel spectrum--natural gas and coal--to try to keep the supply of LTF's growing.
This man is a liar straight in the face - saying that oil has an EROEI bellow 1 is something out of this world. Someone that says this kind of stuff has to be ill intended.
Bash him whenever you can Robert, people like him are a menace to our future.
What happens when the crops this year fail because of the drought and the high temps we have been having?
What happens as you pointed out, when we get further along and depend more on Ethanol and have a wide spread crop failure due to drought and fires and any of an assundry of other things?
Will we be able to feed ourselves and drive ourselves to the store as well?
I have convinced my dad that it's a dim hope to depend on plants to get us the fuel we need to drive everywhere. He points out that Ethanol mixes with water. He has worked on engines and in the oil fields of southern Ill. He does not like the poor gas mileage he gets when he is forced to buy E10 mixed Gasoline.
If Congress were to pass a law saying everywhere had to sell E10, could it really happen? Every state and every pump puts out E10 blend. Would the USA actually be able to do that?
Burning ethanol from corn in unethical and a gastronomical insult.
:-)
http://petroleum.berkeley.edu/patzek/BiofuelQA/Materials/RealFuelCycles-Web.pdf
Here is the abstract:
--Jim Kunstler
Agree 100%, Jim. I just haven't figured out yet how we move the debate in that direction, especially when people like Khosla are telling everyone we don't have to.
Cheers,
RR
Georgia's reaction to Katrina last year is a prime example. The governor waived the gas tax to make gas cheaper with no concern over what it would do the the DOT budget. DOT is already drowning in bond payments and is planning unimaginable road expansions (28 lanes for I75) that are going to be very costly. But we just play the fiddle here like the party is going to continue. There is no public outcry to reduce DOT spending or to reduce the amount of it that comes from non-fuel tax sources.
The governor also suspended school during this time so the gas used for school buses could go to the motoring public instead. The only outcry over that move was from parents who didn't have time to line up babysitters. There was almost no discussion on the importance of the children actually missing school so someone could cheaply fill up their SUV for their forty mile commute. Luckily, we had a mild winter so snow days were used to make up the missed days. What did the governor do to encourage people to conserve or take mass transit? The correct answer is: absolutely nothing. It wouldn't have been a smart political move to make the public change their habits, even in light of such extraordinary events.
As was mentioned earlier in this discussion, everyone has their price for selling out the future. Sadly, for the majority of the public, that price seems to be rather low.
More importantly, too few of us see peak oil as the first bump up against our habitat limitations. Peak oil is to be followed by peak water, peak natural gas, peak coal, and so forth. War will deplete resouces even more rapidly.
The human population has overshot pretty badly, and so we will need to admit to the need for population decline as well as radical cultural change with regard to what "the good life" is and with regard to the best ways to organise human settlement.
The need to radically alter our own lives is where we seem to hit the biggest obstacle to admitting that peak oil is real. It is also the biggest obstacle to admitting that peak oil is just one of the bumps up against our habitat limitations. Finally, the need we have to see ourselves in new ways and to live in new ways also poses an obstacle to imagining what meaningful changes we might make as individuals and in the context of larger groups.
In terms of the political public discourse of my own locale (Minneapolis, MN) peak oil is truly taboo. Even ecological topics are considered impolite if one attempts to connect such conversation with our need to change the way we live.
But this is indeed the direction we need to take -- broadening the conversation to make the needed changes in how we see ourselves and what we do about it.
The media, political establishment, and public cannot bear the term "overshoot" let alone the concept.
Second, even if "peak oil" and even "overshoot" are accepted, the notion that we need to critically examine ourselves continues to be unacceptable.
Hence the focus on "bargaining" or frantically searching for alternative ways to extract the same amount of energy -- and soon water, food, and so forth -- from this tired old finite planet.
I wonder of we will survive long enough to get to "acceptance" of our situation, let alone get around to collectively dealing with it.
Manwhile, I pedal onward on my trusty cargo trike, tilting at oil derricks -- er, windmills, no, no solar panels. Don quixote had a sidekick, though, right?
Even if the world's grains are converted to ethanol, it won't supply enough ethanol for 100% conversion from gasoline.
Agreed, but I am not too sure this will lead to implementing the ideas resulting from the debate, even if there is any sort of consensus or majority.
This is the most critical point I see about PO, GW & whatever other impending crisis.
Whatever the solutions may be they will have to be implemented pretty FAST and working "out of the box".
It has NEVER BEEN THE CASE in previous history that sociopolitical structures were "designed" even when based on "grand schemes" like marxism.
It has always been by trial and error that some more or less viable systems were setup.
We don't have time for trials.
We don't have room for errors.
So?
That's what all my friends tell me will happen whenever I go doomer on them.
I agree... and the debate on TOD frequently does just that; but getting governments to discuss alternative arrangements seems impossible.
At this stage surely governments must be aware that PO will take care of the present levels aviation & driving & suburban sprawl... and that it is not "if" but "when"... I think we are only arguing whether it be in 5 years, 10 years or twenty at best...
So it infuriates me when I read, for example, as I did a few days ago in the British press, about "expanding Heathrow because the government forecasts that there will be twice as many passengers in 2025"
Meanwhile, in the US... there is the plan for the new N-S Superhighway...
If, because of inertia, vested interests, lobbying, whatever... governments can't start "making new arrangements" then please can we at least have a moratorium on continuing to expand the old way?
As you often say, the first step has to be... stop "doing the things the way we have been doing for the last 100 years"
If people want to talk about solutions that are truly sustainable, they are going to have to face the hard facts of physics and ecology.
No!
It's the choice between an uncontrolled free fall (and free-for-all chaotic destruction) and some set of unpleasant circumstances where we've actually made a choice.
Yesterday, I attended at state-level climate change meeting. It was interesting listening to the pitch by the representative from the trucking industry push nuclear power for most everything that uses oil and natural gas. Although he didn't say it, his statement that use of distiallte oil and eventually natural gas for residential and commercial heating ought to be criminalized, was interesting reaction to the realization that oil is going to become a problem for the trucking industry.
More than one person pointed out that electrons will not provide food production chemicals.
It was a great example of TINA tied to current lifestyles.
But hardly reality.
Of course, that's when things will get really interesting, since that will probably also coincide with crime rates drastically increasing, and oil prices falling again after severe demand destruction. I think most people will go through several cycles of crash and burn / rise from the ashes before they really give up on their fond memories of easy motoring.
Last time you posted this paper, you accompanied it with the misleading claim that it debunks all ethanol.
When I said it did not you accused me of not reading the paper and calimed it specificly did refer to ALL ethanol. When I asked for a page or reference, you ran off.
Do you now admit that this paper only discussed grain alcohol and the current status of cellulose techology. It does not in any way discuss sugar-based ethanol production, which is clearly EROIE positive at about ten to one.
*
http://fy.chalmers.se/~np97magr/other/Coursepaper_MeOH_EtOH_2004.pdf
Ethanol has short-sighted agricultural politics behind it, causing us to mostly ignore a more efficient solution that would be much less threatening to food supplies. Synthesis gas/methanol seems to be the most direct and developable route from biomass to liquid fuel.
Here is a link describing Dr. Tom Reed's experience with methanol:
http://www.woodgas.com/methanol.htm
Two thoughts:
The focus on ethanol production, however, stems from the fact that ethanol is non-toxic, it's usage is mandated and the market value of ethanol is higher.
In my experience and as outlined in the Swedish paper you have posted, ethanol production is a learning process for all.
A statement that becomes even more valid as the discussion moves into 2nd generation ethanol production technologies that are just now starting to get mention at TOD.
Corn Rush -- 'Ethanol Fever' Needs a Reality Check
New America Media, Christopher D. Cook, Jul 13, 2006
Editor's Note: Political, corporate and media support of corn ethanol as an alternative fuel can't hide serious problems with this energy source, the writer says. New America Media contributor Christopher D. Cook is the author of "Diet for a Dead Planet: Big Business and the Coming Food Crisis" (New Press). He has written for Harper's, The Economist, The Christian Science Monitor and elsewhere.
http://news.newamericamedia.org/news/view_article.html?article_id=2329e6f5b7aeea555cf71cdc2f0c1329
I sense that you come from an industry where innovation in process is glacial - for whatever reason this colors your perspective and comments and repartee.
From what I know of Mr. Khosla, he bets on teams that innovate to solve problems and improve devices and technology. Innovate in substantive leaps, in technology driven efforts.
Where you are so laughable is how little you seem to recognize what is about to transpire in cellulosic ethanol and how this actually will change things for the better - less waste than with corn based feedstocks, denser yields from arable land and the like.
Hence the shape of the curve.
And clearly those who pump oil do little to innovate, which is understandable, given the near monopoly. The monopoly will change to market driven dynamics, and it won't be coming from Houston or Riyadh, thank goodness.
This stasis in automotive fuel markets will change and the increases in supply of ethanol gathering a head of steam, will put many beneficial dynamics into play for the consumer and the domestic economy, that Vinod and others see, and you wish to resist.
While clearly you would rather claim you are debunking him and while you wish this were the case, I will contend that this will be proven otherwise. it will not be obvious in a day or two, but will be plain in a few years and billions of dollars in ethanol market increases.
Signficant accomplishments of substance take time (especially in tipping points of infrastructure), but in the greater scheme of things, the time later in retrospect will be rather quick especially in the context of stasis in oil markets and oil technology.
In fact, I think I remember a recently published quote regarding a middle eastern oil baron calmly threatening efforts in ethanol, by saying they will crush the efforts by dropping prices as low as they need to.
I suspect there are grains of truth hidden behind the threat, but more important is that this means that the effort and implications for a serious thrust in cellulosic ethanol is substantive, more so than you confess to acknowledging.
Food for thought, despite your shallow attempts at debunking.
It is one thing to have a blog, and spout your wisdom as the truth, and diminsh the efforts of others, and it is another to put ones money and actual efforts into doing something about the looming and present oil crisis. Do, rather than complain and sit in ones boots in the mud.
You can quibble about the slope of a curve, or a few percent of interpretation here or there, but point is they are QUIBBLES that you make mountains of as if they become the main point (possibly of one's ego in your mirror), where predictions are not meant to be perfect to the last 6th decimal point.
The present situation with oil is not merely one of supply, it is a huge drain on the US balance of trade, with massive ongoing impact on the economy and politics for time immemorial.
You seem to marginalize this as your right of birth so to speak - taking for granted that this weak foundation in balance of payments, when it has consequences of all kinds - none of which are beneficial unless you are one of them...
A true patriot would do otherwise.
Check the patents I have been granted, and then get back to me on that. You know what they grant patents for, right? Innovation.
With regards.
Bernardo Marques
I don't criticize Brazil's ethanol industry. I criticize those who point to it as a model for what we can do in the U.S. We use far too much energy, and have far too large a supply/demand imbalance to fill it with ethanol.
Thank you for providing us a great criticism of the ethanol bandwagon. I agree with you that corn ethanol is not the answer. But I think this may be the right way to "kick start" the transition :
- The major fixed costs for ethanol distribution are in setting up the pumps. Not in the manufacture of automobiles. Or in the transport systems for the corn distribution etc.
- So once we have corn ethanol running, the transition to cellulose based ethanol will be extremely smooth.
- Corn ethanol can also break even, going by Mr. VK's argument, if the prices are not tampered by oil corporations.
- It may not do much difference for (a) fossi-fuel reduction (b) greenhouse emissioin, but there are positive contributions from corn ethanol - however tiny the margins are.
- Once the distribution channels are established well, the battle will proceed on a level playing field : between corn ethanol / gasolene / imported sugarcane ethanol / cellulose ethanol.
- It is easiest to kick start this transition in the distribution channels through corn ethanol. Other ways are too futuristic to break even currently.
Thus, I believe that corn ethanol (which maynot be the greatest answer for alternative fuel resource) is the right way to go ahead. It is a calculated risk that has a high probability of paying well.---Ahh, so you're saying that it's only a matter of adjustment. I am more accustomed to hearing arguments of this nature at a brothel. Please explain why our energy usage and supply/demand numbers are more intractible than a thirty dollar hooker.
I find it revealing that with all the facts about ethanol at his fingertips, he decided that the only way he could make a case was by relying on misrepresentations like this. Had there been a sounder argument available I am sure he would have found it and used it. Given the respect I have for his abilities, this comes very close to justifying a slam dunk rejection of his whole case.