Wednesday, January 24, 2007

Energy: Asking the Right Questions

In his State of the Union, Bush talked about energy but I don't have much faith that he will follow through. But it is important for Congress and the American people to start thinking more realistically about where we are and where we need to go. There are, in fact, any number of bills that Congress can pass that will improve our energy future.

Robert Rapier on The Oil Drum has a long post on several types of energy sources and he offers an important set of questions that he attempts to answer:
A question was recently posed here: What is the most important question concerning ethanol production? That got me to thinking about important questions regarding not only ethanol, but all of our energy sources. There are a number of issues that we must carefully consider for any of our potential energy sources.

In my opinion, they are:

1. Is the energy source sustainable?
2. What are the potential negative externalities of producing/using this energy source?
3. What is the EROEI? [Energy returned on energy invested —Craig]
4. Is it affordable?
5. Are there better alternatives?
6. Are there other special considerations?
7. In summary, are the advantages of the source large enough to justify any negative consequences?

There's been a lot of talk again about ethanol in the last couple of days and I fully expect the corn-based ethanol industry to continue growing and to some extent that's fine, but the reality is that corn isn't going to do much about our energy future as the industry methods now stand, and there's a physical limit on what percentage of our oil that ethanol can replace even if all of the Midwest is planted in corn and used only for ethanol. While the return on sugarcane grown in warmer climates like Brazil is reasonably good, the return on corn is not and it is not certain that the problems can be overcome. This means we need to have a broad-based approach to alternative energy and a careful realism when it comes to technologies that aren't productive. One thing to keep in mind is that windpower at the moment is far more productive than ethanol production and even solar cells are more efficient and are continuing to get better. In fact, at some point, since liquid fuels are very useful in a variety of situations, we can expect a method to be worked out that will use windpower to convert corn into ethanol but it still will be far from creating a full energy solution.

For now, except for some areas of Iowa and pockets elsewhere where the yields are better than average, the energy yield on converting corn to ethanol is so low that it's important to understand that the price of ethanol can be no better than the cost of growing corn plus the cost of coal and/or natural gas plus the actual manufacturing cost of converting corn to ethanol plus the profit margin.

For the moment, what we need most are ordinary cars with much higher mileage and a major effort to increase the number of hybrids on the road. Actually, over time, we will need a whole range of things but it will take years to start putting them in place. One final word: corporations should be drooling at all the new innovations and profits our national energy conversion will stimulate; let's hope they create a lot of new jobs at home.



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