The United States' increasing reliance on corn ethanol is one of the most convoluted and wasteful government endeavors in the world. First we massively subsidize corn, then we massively subsidize ethanol production, then we massively tax imports of foreign ethanol from sugar. Result: little reduction in CO2 emissions, massive over-production of corn that destroys land and sea, anger from developing countries about our hypocrisy, and billions of dollars thrown down a rat hole.
Now, the Bush administration is working with the Brazilian government to expand Brazil's ethanol technology around Latin America. While I think this too is a misguided policy, at least sugar cane is relatively efficient. But I worry about all the tropical rainforests that are going to be cut down so people can drive their SUVs.
Part of the deal includes a reduction in U.S. tariffs on sugar ethanol, and already politicians from corn states are up in arms. How dare corn farmers actually have to produce efficient products that have real environmental benefits! This is yet another example of how more often than not, trade protectionism has terrible environmental consequences, and makes bad policy even worse.
Comments
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Erik Hoffner Posted 7:55 am
04 Mar 2007
Yes, tariffs on sugar ethanol should be lowered if not zeroed. We can do better...
The Orion Grassroots Network is a meeting place for 1000+ great grassroots organizations working for conservation and more: http://www.orionsociety.org/ogn
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Biodiversivist Posted 8:37 am
04 Mar 2007
Most Brazilian cane today is grown where there were coffee and fruit plantations, which had replaced the Atlantic rainforest, of which only 7% remains. When it expands there is only one place to get the land for it. Uganda is expanding into rainforest to grow cane, Brazil will eventually do so also, just as they are doing for soybeans.
In the end, it all comes down to biodiversity. Poison Darts--Protecting the biodiversity of our world
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CyberCelt Posted 9:06 am
04 Mar 2007
If you want to make an apple pie from scratch, you must first create the universe. Carl Sagan
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Karen Orr Posted 9:08 am
04 Mar 2007
Expanding large-scale agriculture to grow more sugarcane in Brazil will worsen the loss of species diversity, water-quality problems, and habitat fragmentation in some of the world's most biologically diverse regions.
The biofuels push will directly or indirectly increase the loss to Brazil's remaining natural high biodiversity areas, such as the Cerrado
The 740,100-square-mile Cerrado region is South America's largest savanna--one of the richest in the world, in terms of bird, reptile, fish, and insect species.
More than 50 percent of the Cerrado has already been transformed into pastureland, causing soil erosion, biodiversity loss, fragmentation, and the spread of nonnative grasses.
Most of the expansion required will affect the Cerrado ecosystem and the Amazon, already being destroyed for cattle pasture and soybean farming for animal feed.
Expansion of sugarcane plantations will displace soy and cattle farming in the Cerrado -- driving those operations into the forests which will be destroyed to make way for the farms.
The Amazon is further threatened by the oil palm industry which is now destroying rainforests in Southeast Asia, causing choking fires and greatly contributing to global warming.
The infrastructure is being created for international biofuel destruction
NYT: U.S. and Brazil Seek to Promote Ethanol in West
http://www.nytimes.com/2007/03/03/business/worldbusiness/ ...
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Biodiversivist Posted 10:00 am
04 Mar 2007
However, sugar cane farms are located mostly in south-central Brazil, around São Paulo, and along the northeast coast, on land that was carved out of drier areas of the Atlantic rain forest, which has more different species of plants and animals per acre than the Amazon. Less than 7 percent of the total Atlantic rain forest remains -- thanks to sugar, coffee, orange plantations and cattle grazing.
I flew in a helicopter over the region near São Paulo, and what I saw was not pretty: mansions being carved from forested hillsides near the city, rivers that have silted because of logging right down to the banks, and wide swaths of forest that have been cleared and will never return.
''It makes you weep,'' said Gustavo Fonseca, my traveling companion, a Brazilian and the executive vice president of Conservation International. ''What I see here is a totally human dominated system in which most of the biodiversity is gone.''
As demand for sugar ethanol rises -- and that is a good thing for Brazil and the developing world, said Fonseca, ''we have to make sure that the expansion is done in a planned way.''
Over the past five years, the Amazon has lost 7,700 square miles a year, most of it for cattle grazing, soybean farming and palm oil. A similar expansion for sugar ethanol could destroy the cerrado, the Brazilian savannah, another incredibly species-rich area, and the best place in Brazil to grow more sugar.
A proposal is floating around the Brazilian government for a major expansion of the sugar industry, far beyond even the industry's plans. No wonder environmental activists are holding a conference in Germany this fall about the impact of biofuels. I could see some groups one day calling for an ethanol boycott -- à la genetically modified foods -- if they feel biofuels are raping the environment.
We have the tools to resolve these conflicts. We can map the lands that need protection for their biodiversity or the environmental benefits they provide rural communities. But sugar farmers, governments and environmentalists need to sit down early -- like now -- to identify those lands and commit the money needed to protect them. Otherwise, we will have a fight over every acre, and sugar ethanol will never realize its potential. That would be really, really stupid.
source: http://spot.colorado.edu/~kaplan/Current_Events/Brazil-Fr ...
In the end, it all comes down to biodiversity. Poison Darts--Protecting the biodiversity of our world
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Ron Steenblik Posted 10:21 am
04 Mar 2007
Mindful of protests from domestic ethanol producers and from the powerful American farm lobby, administration officials are not expected to even hint at a reduction in American tariffs on foreign ethanol.
As for the sustainability of Brazil's ethanol production, Karen points out that it is more the Cerrado than the Amazon that might be directly affected by continued expansion of sugar cane. Any affect on the Amazon will be indirect, through the displacement of other agricultural industries. How much of that displacement will take place will also depend on the effectiveness of government policies to stem illegal forest clearing.
Currently most of Brazil's cane production is concentrated at the southern edge of the Cerrado (compare slide 25 of this PowerPoint presentation with this aerial photo). Some of the current expansion (slide 27) is into the Cerrado, some of it is not.
However, countries with glass houses should be careful at where they throw stones. Maintaining the tariff in order to protect U.S. corn-ethanol production also has damaging consequences for the environment, ranging from the plowing up of prairie land to water pollution. Already, protecting U.S. sugar producers from Brazilian ethanol has meant greater production of sugar in the USA -- and hence pollution of the Everglades -- than probably would have taken place in its absence. And as U.S. soybean acres are reduced by corn plantings, and more of the oilseed crop is used for making biodiesel, some of that slack will be picked up by other countries, including Brazil, whether the ethanol tariff remains in place or not.
Ultimately the pressure on ecosystems caused by production of biofuels can be attributed to mandates and subsidies. Brazil mandates a minimum of between 20% and 23% anhydrous ethanol in all gasoline blends, and charges lower fuel taxes on ethanol than on gasoline. The U.S. federal government has set volumetric targets, and indirectly subsidizes its production. (Many states provide additional incentives.) Without these measures, it is doubtful production of ethanol for fuel would be anywhere near the volumes we are witnessing today.
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jscorse Posted 10:43 am
04 Mar 2007
This issue highlights why good intentions can go terribly awry- THE LAW OF UNINTENDED CONSEQUENCES reigns supreme and government "picking" technologies in a rapidly changing technological landscape is almost always bad policy. In this case, it may be devastating to biodiversity.
J.S
J.S.
htt://voicesofreason.info
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DAVES Posted 12:59 pm
04 Mar 2007
Nothing would be more impressive than a knowledgeable IPO that harnessed the power of many investment dollars from many individuals that dont want to support the current governments misjudgements based on temporary political gain. The technology and emphasis will go where the money is and we wont have to import ethanol from Brazil.
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Ron Steenblik Posted 5:04 pm
04 Mar 2007
Last July, the USDA estimated that the cost of converting sugar beets into ethanol was approximately $2.35 per gallon based on 2003-04 sugar beet market prices and estimated sugar beet processing costs. That was when futures contracts for #11 sugar were exchanging hands on the New York Board of Trade (NYBOT) for between 6 and 9 cents a pound. Over the last several months the price has ranged between 10.5 and 12 cents, and a year ago it briefly approached 20 cents a pound. When sugar (and high-fructose corn syrup) prices are high, it makes much more economic sense to sell sugar and molasses in those forms, rather than spend additional money and energy transforming them into ethyl alcohol.
Since investment in small-scale sugar-beet ethanol is not occurring as you would wish, it would be helpful if you could explain your underlying assumptions for changing that situation around. Are you hoping to see the end of protection of U.S. sugar prices? Would you, like the EU, still maintain the 54-cents-per gallon import tariff on ethanol? Are you assuming a continuation, and extension, of the 51-cents-per gallon federal tax credit for ethanol blended with gasoline, and the $0.10-cents-per gallon small producers' credit? Or are you suggesting additional subsidies (or a guaranteed market) for ethanol produced from domestic sugar, as some have proposed for cellulosic ethanol?
**
Jason: here is another good article on the budding Inter-American ethanol alliance.
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Whiskerfish Posted 11:05 pm
04 Mar 2007
One must also realise that on-the-ground policing of enviro regulations is near-as-dammit absent over there - be very, very suspicious of anything that looks good on paper, because it probably doesn't look good in reality.
Cheers
Whiskerfish
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Junkk Male2 Posted 2:56 am
05 Mar 2007
http://junkk.blogspot.com/2007/03/with-all-due-apologies- ...
Do before you talk. Then share. If it's also fun and inspiring, people will want to read more. They may even be inspired follow your example.
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Biodiversivist Posted 3:41 am
05 Mar 2007
http://news.independent.co.uk/environment/climate_change/ ...
And I agree with the message on your blog. Hopefully, the best answers will eventually float to the top in spite of government interference.
In the end, it all comes down to biodiversity. Poison Darts--Protecting the biodiversity of our world
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Jason D Scorse Posted 6:49 am
05 Mar 2007
J.S.
J.S. teaches environmental economics and blogs at http://www.voicesofreason.info.
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JMG Posted 6:07 pm
05 Mar 2007
http://www.jeffvail.net/2007/03/why-free-market-fails-con ...
tidbits:
...
The free market will ignore solutions that can't turn a profit. Any firm that fails to follow this simple maxim won't be in business for long. The corollary to this maxim is that the free market will ignore any solution that cannot be controlled, either through property interests (enforceable intellectual property, monopoly licenses, etc.) or because economies of scale demand centralized operation. This means that free market innovation is structurally incompatible with a huge portion of the universe of possible energy solutions.
Free markets love non-renewable energy sources because they are readily controlled. ... But renewable energy presents a serious control challenge to the free market's need to profit.
...Take ethanol and other biofuels, for example. This attempted solution to our energy problems can be controlled both through real property (ownership of the farm land that produces the raw materials) and through intellectual property (proprietary distilling processes, patented microbes that convert things to sugars, etc.).
Never mind that biofuels provide a suspiciously poor energy return on investment and often require government subsidies, slave labor, or fossil fuel inputs, or that they don't address more fundamental problems like the world's ongoing growth in energy demand, topsoil depletion, or competition between food and energy. They can make money. Is this the best that free-market innovation can provide?
What about solar? The free market is investing huge resources into innovation in this field. Virtually all of it, however, is being invested in proprietary technology for photovoltaics. In other words, property, which can be controlled to produce a profit.
Never mind that, while photovoltaics are a great way to produce electricity, they are a very poor way to produce energy (see my discussion on this point).
Why does the free market almost entirely ignore the potentially rich conceptual space of passive solar design? Precisely because the obvious value in this area--that of refining and implementing vernacular technologies--cannot be effectively controlled through existing intellectual property mechanisms. If it can't be controlled to produce a profit, then free market innovation is blind to its potential. Never mind that, in my opinion, passive solar design is the single most promising way to meet our future energy needs?
...
Sure, the free market can innovate something to sell you that will help you conserve, but the actual act of conservation kills profits. I'm not talking about increased efficiency of our energy use (which, as classical economics tells us, lowers cost and frees up the consumer to expend the money saved in consumption elsewhere, thereby increasing the total standard of living--at least when measured as a function of consumption). No, I'm talking about actual conservation--just plain using less. This is anathema to free market economics.
The idea that we could use less energy in total, and then invest the savings in non-economic goods such as leisure time or security-through-self-sufficiency, is highly problematic because it causes a cumulative decrease in GDP (leisure time doesn't count as a "product"!).
...
So, if free market innovation fails in the entire sphere of vernacular-design-based solution, and can't even contemplate conservation-based solutions, then is it really the pinnacle of sustainable energy innovation? There is only one guaranteed result of relying on the free market to solve our energy problems in a world where production from fossil supplies is peaking: its solutions will never free us from energy dependency or energy scarcity.
...
Similarly, the free market will never have the economic motivation to make energy cheaper (over the long-term)--it would be, by definition, irrational economic behavior to produce energy so cheaply that the total value of the world market for energy goes down.
If that's what you're looking for--depending on someone else for energy that is always getting more expensive--then the free market is your innovation engine of choice....
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Junkk Male2 Posted 6:37 pm
05 Mar 2007
And as we're on a roll, or in this case dessert analogy, I can only agree with you and hope you are right.
Shame that the best processes just seem to take their own sweet time, and the quick fixes and those with vested interests is making and shouting about them tend to get in the way en route.
Do before you talk. Then share. If it's also fun and inspiring, people will want to read more. They may even be inspired follow your example.
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vandusenelliot Posted 1:55 am
09 Mar 2007
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GreyFlcn Posted 6:01 am
09 Mar 2007
They achieved it due to drastically increased domestic oil production.
http://new.api.org/aboutoilgas/sectors/segments/upload/Br ...
_
So the whole arguement about their Ethanol causing their energy independance is bunk.
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GreyFlcn Posted 7:43 am
09 Mar 2007
That would only slightly less than double our Ethanol production.
Sure, it can be ramped up to some extent, but it's going to hit a wall when it runs into the rainforrest.
Or, it won't stop at the rainforrest.
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