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As mandates and government aid ramp up, the case for ethanol runs out of steam

As President-elect Barack Obama and the new Congress mull a bailout for ethanol makers, the industry absorbed two body blows this past week.

1) The Environmental Working Group released a study revealing the profound opportunity costs associated with our government's generous support for ethanol.

The corn-based fuel grabs three-quarters of all federal renewable-energy tax credits, EWG reports. Ethanol gets more four times as much cheese as wind, solar, and geothermal combined. If you add in support for biodiesel, biofuels grab 80 percent -- four dollars in five -- of federal tax largesse to renewable fuels. In short, the dubious practice of turning corn and soy into liquid car fuel is crowding out other more energy-rich and sustainable energy sources.

2) A professor from Iowa State University -- ground zero of ethanol fervor -- has broken ranks and issued a scathing, cogent critique [PDF] of of the ethanol program. Here's a juicy sample from the paper, by Dennis Keeney, emeritus professor, Department of Agronomy and Agriculture and Biosystems Engineering:

About 6.7% of the gasoline used in the U.S. will be displaced by ethanol in 2009, when corrected for the lower energy content of ethanol and assuming an annual gasoline consumption of 140 billion gallons. Assuming a net energy gain in the conversion of corn to ethanol of 1.25, there is a net energy displacement of approximately 2.8 billion gallons of gasoline, about a 2% net energy gain. If the energy in nonfuel byproducts (e.g. distillers grains, which are used for cattle feed) is removed from the equation, the net energy gain is close to nil. In other words, ethanol from corn will do nothing to boost net energy supplies.

Let's put these two assessments together: We're handing three-quarters of the resources we have for alternative fuels to one that delivers precisely ... nothing. At a time of rapid climate change and mounting budget deficits.

Below, a few choice nuggets from the two papers.

Green(ish) news from our nation's capitol

• Sen. Dick Durbin (D-Ill.) wants to get funding for FutureGen -- the proposed "zero emissions" coal plant that the Bush administration axed due to ballooning costs -- into the stimulus package. Durbin said Thursday that he got a "positive response" when he discussed it with energy secretary nominee Steven Chu. His state-mate Barack Obama pushed to revive the plant back when he was just a senator.

• At a hearing on Thursday, Senate Energy and Natural Resources Chair Jeff Bingaman (D-N.M.) announced the newest Democratic members of his committee (though their appointments aren't yet final): Evan Bayh (Ind.), Debbie Stabenow (Mich.), and two new senators, Mark Udall (Colorado) and Jeanne Shaheen (New Hampshire).

• It's looking increasingly likely that Wall Street big-wig Steve Rattner, who works for the private investment firm Quadrangle Group, will be named as Obama's "car czar."

Digital TV delay could be win for environment

Anyone with a working TV set has likely seen the ubiquitous ads educating the public about the Feb. 17 switch to all-digital broadcasting. But millions of Americans still aren't prepared and could miss out on important news and emergency broadcasts -- a fact that has led President-elect Barack Obama to urge a delay in the transition.

Such a delay could be a perfect opportunity for manufacturers to improve their recycling programs, say activists from the Electronics TakeBack Coalition. The ETBC recently put together a report card ranking the major TV companies on their take-back policies. Highest-ranked Sony got a B- for leading the pack with the first national take-back program, but more than half of the 17 companies got failing grades for having no programs in place at all.

This week, at the Consumer Electronics Show in Las Vegas, ETBC has been calling attention to the lack of take-back programs -- and the electronic waste that will be created when a "tsunami" of analog TVs hit the landfill -- with a cadre of TV zombies (see video below). [Note to ETBC: Didn't you get the memo about vampires being the undead of the hour?]

Robert Stavins can't walk and chew gum at the same time

One of my New Year's resolutions is to blog more about the general lameness of the economics profession when it comes to energy and climate issues. (Note to self: How about losing a few pounds?)

I was in the midst of putting this resolution off for a few weeks when I saw a quote by Robert Stavins that seemed to sum up the value-subtracted that economists bring to the world.

In an otherwise excellent New Yorker article on Van Jones' efforts to push a green jobs agenda, which I will blog on separately, Elizabeth Kolbert feels compelled to "balance" Jones with some people who don't think it's a good idea to simultaneously address the climate problem and the poverty/jobs problem. Who else could a respectable journalist turn to than an economist, a profession that arguably has cost the country and the world more jobs than any other?

Indeed, I remember Bill Clinton opining at a Georgetown conference in 1997 on why he ignored the advice of Administration economists, like Larry Summers, who urged him not to adopt a serious greenhouse gas emissions target at Kyoto. Clinton said his economic team had assured him that his balanced budget plan would be a job killer, so he pretty much took everything they said from that point on it with a grain of salt. But I digress.

Kolbert manages to elicit this amazing response from one of our leading economists:

U.N. says ignore the cold, warming is still a problem

GENEVA — Icy conditions that have claimed dozens of lives across Europe since November are partly due to La Nina, an upsurge of cooler water to the Pacific Ocean surface, the UN’s weather agency said Friday. “The cold snap currently being experienced can be partly attributed to the La Nina phenomenon, which is a cooling […]

Greenpeace grades gadgets unveiled at CES

LAS VEGAS — Consumer electronics manufacturers are making greener products than a year ago but more progress needs to be made before they can claim a truly environmentally friendly product, Greenpeace said Friday. In its second greener products survey, “Green Electronics: The Search Continues,” the environmental activist group assessed the progress made by consumer electronic […]

Friday music blogging: Ladyhawk

I'm in a rush here -- got an actual date with my wife tonight! -- but real quick: here's a song from a Canadian indie band called Ladyhawk, who combine rootsy twang with Hüsker Dü-esque wailing. I'm in love with this song and recommend the album, Shots, highly.

(Or download the album as mp3 files.)

Fishermen who play by the rules deserve some help

Taking up Tom Philpott's food stimulus challenge, I suggest bailing out the fisherman. Of course, fish stocks internationally are still in serious decline -- you need look no father than the Atlantic bluefin tuna to see that. But according to a report on NPR, we're having some serious fisheries-management success stories on the West Coast. Now it's the local fishing fleets rather than the fisheries that threaten to collapse. At first, the government thought they had engineered a "soft landing" for fishermen when:

... five years ago many fishermen who trolled for groundfish agreed to give up their boats for a lump sum of cash. That dramatically reduced the size of the fleet. There are only about 160 bottom trawlers left in California, Oregon and Washington.

As a result, nets are full and quotas are easily met. But now regulators are converting fishing quotas into a cap-and-trade system. There's no question that this is an important development. Since fishermen will be able to buy and sell portions of their quotas, they'll throw less of their catch overboard (dumping fish being the only legal way to dispose of excess catch). Under the new system, they'll just hop on the radio and buy some of the fishing rights from a fellow fisherman who has room to spare in his hold.

Everything looks peachy so far, but all industries need a certain scale. As the fleets continue to shrink and more fishermen sell their quotas and their boats, fishing ports, which include processing plants and other supporting services, will shut down entirely. These are businesses that, unlike the meat industry's now defunct network of local abattoirs and butchers, have so far resisted centralization.

So how about some incentives to keep these folks afloat? Fishermen should be encouraged to stay on the water, not to become fish stock brokers. If a little of the stimulus money can help us manage the fishermen along with the fisheries, it would be a boon to struggling coastal communities and would preserve fishing as an environmentally and economically sustainable tradition. Aside from the fact that any job lost is a crisis in this economy, it would be a shame that our success with the fish should lead to disaster for the people.

Think locally, act infrastructurally

President-elect Barack Obama and the new Congress can’t afford to turn their attention to reforming the food system. We’ve got two wars to fight, the Middle East conflict is raging again, the financial system is in chaos, and layoffs are mounting. And don’t forget the likelihood of trillion-dollar annual budget deficits for years to come. […]

Labor nominee Hilda Solis talks green jobs at her confirmation hearing

The topic of green jobs cropped up at Friday's confirmation hearing for Labor nominee Hilda Solis before the Senate Health, Education, Labor and Pension Committee. From Solis's opening statement:

If confirmed, I will work with President-elect Obama, my colleagues in the Cabinet and you to reinvest in and restructure workforce development and ensure a strong unemployment insurance system. This includes promoting what we now know as green-collar jobs. These are jobs that will provide economic security for our middle-class families while reducing our nation's dependency on foreign oil and resources. These are jobs that will also stay in the United States. My hope is that these jobs will not be outsourced.

And later in the hearing:

I know in the state of California we are looking very anxiously to see that we can help rebuild our schools, help to transform our transportation system to help reduce air pollution and congestion, and get people to work on time ... I think the greatest asset that I see here sitting before you is to promote the green-collar jobs and trying to make that opportunity available, not just to those that are already looking for jobs, but those that want to have an opportunity for a career change.

And then this soft-ball exchange with Sen. Bernie Sanders (I-Vt.):

Sen. Sanders: Now, let me begin by just asking you a few questions, and the first one is going to be a very, very tough question. You helped create in the House the Green Jobs Workforce Training Program, and I worked with you in the Senate, along with Senator Clinton. Now, on that very tough question, will you help us move that program along, the one that you helped create?

(Laughter.)

Rep. Solis: Yes.