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A bill looks to put an end to government promotion of burning food for fuel

Should America burn its food crops for fuel?  A new Senate bill looks to change the government's policy on that question.

I. Short and Sweet, Like Corn -- But Not For Big Corn

If you read enough legislation from the U.S. Senate and House of Representatives, you'll notice something.  The longer a bill is, the more likely it is to be a bad bill, littered with special interest earmarks and loaded language.

The new Senate bill is not a long bill.

It weighs in at under 2 and 1/2 pages.  While still a bit on the verbose side (it could arguably summarized in three sentences) this is a relatively rare and remarkable instance of brevity.  Under the working title "The Corn Ethanol Mandate Elimination Act of 2013" [PDF], the bill is so fresh it has not even received a number yet.

The Corn Ethanol Mandate Elimination Act of 2013


The bill is sponsored by the office of U.S. Senator Dianne Goldman Berman Feinstein (D-Calif.).  While Sen. Feinstein's support of the federal government spying on law-abiding Americans  by the U.S. National Security Agency (NSA) has angered many social libertarians, including left-leaning ones, her bill should please those who feel the government should step back from its current role as a rampant market manipulator, allowing consumers to decide in a free market what they want.

Sen. Feinstein
Some might be surprised at Sen. Feinstein's new bill, which aims to scale back one key government market manipulation program. [Image Source: Sen. Feinstein]

It is cosponsored by eight Republican Senators and two of Sen. Feinstein's fellow Senate Democrats.  It states its purpose as:

To amend the Clean Air Act to eliminate the corn ethanol mandate for renewable fuel, and for other purposes.

The first paragraph of the proposed changes states:

(a) REMOVAL OF TABLE —Section 211(o)(2)(B)(i) of the Clean Air Act (42 U.S.C. 7545(o)(2)(B)(i)) is amended by striking subclause (I).

What is "42 U.S.C. 7545(o)(2)(B)(i) subclause (I)"? You guesed it -- the paragraph of the law that institutionalizes corn ethanol market manipulation.

Senator Tom Coburn
Sen. Tom Coburn (R-Okla.) [Image Source: Conservative.me]

The bill is co-sponsored by: * (the bill's coauthor)

Of these authors, only four are from states that produce corn on a substantial scale.  Those four come from Pennsylvania, North Carolina, and Tennessee -- states with small corn industries that are 15th, 19th, and 20th in terms of corn production by state, respectively (source [PDF]: U.S. Census Bureau).

Sen. Coburn tells Thomson Reuters:

Eliminating this mandate will let market forces, rather than political and parochial forces, determine how to diversify fuel supplies in an ever-changing marketplace.

Sen. Dianne Feinstein adds in her press release:

Under the corn ethanol mandate in the RFS, roughly 44 percent of U.S. corn is diverted from food to fuel, pushing up the cost of food and animal feed and damaging the environment. Oil companies are also unable to blend more corn ethanol into gasoline without causing problems for automobiles, boats and other vehicles. I strongly support requiring a shift to low-carbon advanced biofuel, including biodiesel, cellulosic ethanol and other revolutionary fuels. But a corn ethanol mandate is simply bad policy.

Corn ears
The bill sharply divides politicians from corn farming states from their Congressional colleagues.
[Image Source: Farm Progress]

The bill generally divides politicians in corn farming states against their party colleagues in non-corn states.  However, it appears to have majority support in both the U.S. Senate and House, the latter of which is controlled by Republicans who are eager to appear to oppose market manipulation and government handouts in lieu of next year's elections.

II. Other Biofuel Quotas Left Untouched

The rest of the law is remarkably simple -- it just renumbers the remaining biofuel mandates which are preserved and removes one other reference to the corn ethanol mandate in the mandate for cellulosic ethanol (a chemically identical alternative to corn ethanol which is produced from non-food sources).

Yes, the bill does leave in place market manipulation to create market demand for lesser used, less controversial biofuels, including biodiesel and cellulosic ethanol.

Cellulosic visualization
Commercial ethanol from cellulose (pictured) tough sugar polymer in woody plants has thus far proven commercially infeasible, making its blending quotas a moot point. [Image Source: CUNY]

In the case of cellulosic ethanol this is pretty much a moot point as there's been virtually no commercial production to date. Researchers have failed to come up with a cheap enough process to convert cellulose (a tough polymer found in woody plants) to fuel.
 
Two cellulosic ethanol startups -- Inios Bio and KiOR -- claim to be "near" commercial production, after tens of millions in startup capital.  But neither company has a working commercial scale plant yet.
 
Other cellulosic ethanol companies -- such as Coskata, which General Motors Comp. (GM) backed pre-bankruptcy -- are still floating around, showcasing "semi-commercial" scale plants -- which produce hundreds of gallons of fuel a month, not millions.  But compared to the ambitious claims of a few years back, it would certainly seem such firms have lost a degree of their momentum.

Biodiesel
The bill protects biodiesel, which also comes from food crops. [Image Source: Wikimedia Commons]

The biodiesel issue is slightly thornier -- particularly since there will invariably be accusations of favoritism (Sen. Feinstein's home state of Calif. is a top biodiesel hotbed).  However, in the grand scheme of things biofuel blending quotas this year was about a tenth (at 1.7 billion gallons) of corn ethanol production.  And the fuel generally is more compatible with older vehicles and yields better fuel economy than ethanol blends.  So leaving biodiesel in place, if problematic, is much less so than corn ethanol.
 
III. At Stake -- The Renewable Fuel Standard
 
Currently the position of the U.S. federal government on whether food should be burned for fuel is a resounding "yes".  The Renewable Fuel Standard (RFS), signed into law by President George Walker Bush (R) in 2007 institutionalized market manipulation to promote corn ethanol.
 
The bill requires refiners to blend in a certain number of gallons (in the billions) of corn ethanol fuel into gasoline.  Those who don't blend face stiff fines under the provisions of the Clean Air Act (42 U.S.C. 7545).  Because the refiners are forced to blend in ethanol, consumers are, in effect, forced to buy it -- whether or not they like it.
The Clean Air Act
The Clean Air Act was initially intended to protect U.S. air quality, via market controls/manipulation.  It was expanded by the RFS to promote ethanol in the name of "national security". [Image Source: Earth Times]

The Clean Air Act gave the U.S. Environmental Protection Agency (EPA) the ability to regulate (i.e. manipulate) the U.S. fuel market as the federal government sees fit.  As its title suggests, the initial purposes of this market manipulation was to promote clean air.  With 2007's RFS it was transformed into a tool to give special interest handouts to big corn farming corporations, or to protect U.S. national security, depending on who you ask.

Gasoline containing ethanol is known by the fractional volume of the fluid occupied by the ethanol.  Today the U.S. sits at the so-called "blend wall" with most of the fuel sold at E10 -- 10 percent ethanol by volume.  The blend wall works out to the federal government forcing refineries to purchase 13.0 billion gallons of corn ethanol a year.

Increase that number by a billion gallons or so -- as the RFS law demands -- and you go over that blending wall, forcing refineries to start producing and selling modest quantities of E15.

Ethanol Fuel Blends
Common ethanol fuel blends [Image Source: Wikimedia Commons]

There are plenty of criticisms of E10.  Studies have shown corn ethanol produces more greenhouse gases over its lifecycle than gasoline.  And some studies have even suggest that the entire production process for corn ethanol can be energy negative -- using more fuel than is produced.
 
And E10 requires engines to operate in so-called "mixed mode", delivering lower efficiencies.  In layman's terms ethanol and gasoline are chemically different enough that an engine cannot be optimized to burn both efficiently.  In some nations like Brazil who have a massive excess of sugar production, cars run on pure ethanol; these engines are very efficient. However, in the U.S. gasoline is the dominant fuel.
 
So when consumers use E10, they get fewer miles out of a tank of gas as their engine runs less efficiently.  Ethanol producers contend that the artificially created "competition" with gasoline producers has lowered the price at the pump, offsetting this lower efficiency.

Ethanol production
One criticism of corn ethanol fuel is that it produces more emissions than gasoline over its life cycle and may actually consume more fuel than it yields. [Image Source: Alternative-Energy News]

They point out that ethanol reduces U.S. dependence on foreign oil.  A third of the U.S. oil imports come from a relative secure foreign state -- Canada, the largest single exporter of oil to the U.S.  And more might come from there had current U.S. President Barack Hussein Obama (D) not blocked the Keystone XL pipeline.

Still approximately a third of U.S. oil imports come from OPEC (Organization of the Petroleum Exporting Countries) -- which includes member states affiliated with terrorism and/or hostile regimes including Iraq, Saudi Arabia, and Venezuela (source: U.S. Energy Information Agency (EIA)).  Corn ethanol indeed reduces imports, potentially saving some American lives in conflicts in these volatile regions over resources.  However, critics point out that there are alternatives -- including opening up more U.S. lands to fracking or promoting a combination electrified vehicles + nuclear power.

Sources: The Corn Ethanol Mandate Elimination Act of 2013 [PDF], Sen. Feinstein [press release], The New York Times, The Gazette [Cedar Rapids, Iowa]





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