Corn (Maize) Ethanol in America -- Facts & Figures

Ethanol Changes Corn Market, But Doesn't Reduce Petroleum Use

Corn Price, $/bushel, Chicago Board of Trade nearby contract

An increasing fraction of the U.S. corn (maize) crop is being converted to fuel alcohol, with predictable effects on U.S. Agriculture: higher corn prices (as shown in the chart above), higher meat prices, and more money in farmers' pockets.

The map below shows the location of current ethanol plants (green dots) and plants under construction or expansion (yellow dots). As you can see, capacity is going to about double over the next few years.

U.S. Ethanol Plants, source: CARD, ISU

The two charts below show USDA projections for corn use and corn prices over the next ten years. The production of corn will increase, responding to the higher price. Virtually all the additional corn will be converted to ethanol. Much of this additional corn production will come at the expense of soybean planting, and will therefore decrease the production of soybeans. (Biodiesel production will have an additional effect, to be discussed in another post.)

The fraction of the U.S. corn crop used to make fuel ethanol is projected to more than double over the next few years, from 14% to more than 30%.

Little to No Impact on Fossil Petroleum Use

In spite of this apparent surge in ethanol production from corn, the proportion of total petroleum use that will be supplied by ethanol will only grow from 1% to 2% over the next ten years. (See data at the Energy Information Administration: Renewables Consumption By Sector and Petroleum Supply and Demand.)

Unless we change our ways, we will be burning more oil ten years from now than we burn today.

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These posts are thoughts that have occurred to us here at GCF Associates and Global Climate Fund. Feel free to contact us if you have any questions or ideas for future posts.

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Daylight "Savings" Time?

What Does Daylight Savings Time Save?

The United States is starting "daylight savings time" (summer time) some weeks early this year, and will continue it longer in the autumn. (Canada is forced to follow suit -- sorry.)

This change was decreed by the "Energy Policy Act of 2005" (pdf here; html here). Besides the $2.2 billion in direct spending this act handed out (estimated over its first 5 years by the Congressional Budget Office) and the $7.9 billion in tax breaks it authorized over the same period, Congress in its wisdom decided to do something about energy independence and global warming by adding an additional month of daylight savings time.

Nearly every statement by a politician about this change included these words: "will save the equivalent of 100,000 barrels of oil a day." (See the 2005 Energy Conference Report pdf, or the press release of Congressman Fred Upton [R-Michigan], who introduced this provision).

This figure comes from a study done by the Department of Transportation in the '70s. I can't find the original study, but it was quoted in testimony of then-acting deputy assistant secretary for transportation policy Linda Lawson before House Science Committee in 2001. Her testimony in part:

I want to note that these studies are over 25 years old and were limited in scope. Congress captured many of the benefits identified in our studies in the legislative changes to daylight saving time enacted in 1986. There have been dramatic changes in lifestyle and commerce since we completed our studies that raise serious questions about extrapolating conclusions from our studies into today’s world.

. . .

Let me now briefly summarize the technical findings regarding daylight saving time benefits. The studies are over twenty-five years old and have not been updated.

Our 1975 study concluded that daylight saving time might result in electricity savings of 1 percent in March and April, equivalent to roughly 100,000 barrels of oil daily over the two months. These savings were calculated from Federal Power Commission data for only four daylight saving time transitions -- in the winter, spring and fall of the 1974 - 1975 experiment. Due to the limited data sample, the findings were judged "probable", rather than conclusive. Theoretical studies of home heating fuel consumption identified small savings due to daylight saving time. No potential increases in travel demand and gasoline use due to daylight savings time were identified at that time. The lack of actual data precluded an estimation of net daylight saving time energy savings.

. . .

Before making changes to daylight saving time, we urge the Congress to consider the costs and benefits of such changes. As I have noted, DOT’s studies are over 25 years old. New studies must consider impacts on uniformity, impacts on coordination of transportation and commerce, impacts on transportation safety, and net energy impacts. The studies must consider the impact of changes on electrical lighting use, heating energy use, air conditioning use, and transportation energy use, including the potential for increased travel demand resulting from more evening daylight and increased gasoline use.

But apparently Congress focused on the "equivalent of 100,000 barrels" and extended daylight savings time. Note that 100,000 barrels is 0.5% of daily petroleum consumption in the U.S. In fact saving electricity doesn't save much oil, since most electricity is generated with coal or natural gas. Daylight savings time can have no real impact on oil imports.

No Real Savings

More recent studies find very slight and uncertain savings, or none at all.

Does Extending Daylight Saving Time Save Energy? Evidence From an Australian Experiment by Ryan Kellogg and Hendrik Wolff, January 2007:

Given the economic and environmental imperatives driving efforts to reduce energy consumption, policy-makers are considering extending Daylight Saving Time (DST). Doing so is widely believed to reduce electricity use. Our research challenges this belief, as well as the studies underlying it. We offer a new test of whether extending DST decreases energy consumption by evaluating an extension that occurred in the state of Victoria, Australia in 2000. Using half-hourly panel data on electricity consumption and a triple-difference treatment effect model, we show that, while extending DST does reduce electricity consumption in the evening, the increased demand in the morning cancels this benefit out. We statistically reject electricity savings of 1% or greater at a 1% significance level.

Electricity Savings From Early Daylight Saving Time by Adrienne Kandal, February 2007:

There is no clear evidence that electricity will be saved from the earlier start to daylight saving time on March 11, but the 7 p.m. peak load will probably drop on the order of 3% for the remainder of March, lowering capacity requirements. This could be negated by a new morning spike as it was in Australia in 2000, but that appears unlikely. In any event, capacity constraints usually do not occur in March and early November.

. . .

In summary, it seems very likely that our peak load will drop in the evening, possible that we will save a fraction of a percent of total electricity use, and possible but not very likely that we will see a morning electricity spike that would negate evening savings. Still, California might want be prepared for a possible morning mini-peak as it makes forecasts for electricity needs. Victoria’s failure to prepare for its morning peak caused morning price spikes.

Moral:

Politicians want to be seen to be doing something about energy problems, but don't seem to care if their actions really help or not. If we want something done, we will have to do it ourselves.

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These posts are thoughts that have occurred to us here at GCF Associates and Global Climate Fund. Feel free to contact us if you have any questions or ideas for future posts.

environment energy climate change global warming alternative energy

How Much Carbon Dioxide?

How much CO₂ does your economy emit?

Everybody knows that the United States is the World Leader in CO₂ emissions. We are responsible for about a quarter of the whole world's annual CO₂ emissions from burning fossil fuels. (The top 11 producers [including the EU15 as one] account for about 80% of world emissions.)

But there are other ways of measuring a nation's impact on atmospheric CO₂. For example "carbon intensity" is the metric tons of CO₂ emitted divided by GDP. The carbon intensity of the U.S. is about half a ton of CO₂ per $1000 of GDP (measured in 2000 dollars). Some of the top 11 have higher intensity (China, Russia, South Korea, Iran and Australia) and some have lower (Japan and India are the lowest at about a third of a ton per $1000 GDP, converting their currencies at purchasing power parity.)

Or we might compare carbon dioxide emissions per capita. This puts the U.S. back on top, together with Australia and Canada at about 20 metric tons of CO₂ per person per year. Japan and Europe produce half as much per person, China 3.6 tons per person, and India only one ton.

These per-capita comparisons are shown graphically above, and here.

Most of these figures were found at the U.S. Energy Information Administration site. The map at Nationmaster is based on data maintained by the World Resources Institute.

List of countries by ratio of GDP to carbon dioxide emissions (the inverse of the carbon/GDP metric discussed above)

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These posts are thoughts that have occurred to us here at GCF Associates and Global Climate Fund. Feel free to contact us if you have any questions or ideas for future posts.

environment energy climate change global warming alternative energy

What Causes Global Warming?

Did You Know?

For every pound of gasoline your car burns, about three pounds of CO₂ come out the tailpipe. So if your car gets 20 miles per gallon, you are emitting about a pound of CO₂ per mile.

(For every kilo of petrol your car burns, about three kilos of CO₂ come out the tailpipe. So if your car gets 8.5 km per liter, you are emitting about a quarter of a kilogram per kilometer.)

How can the amount of CO₂ that comes out be three times the amount of gas that goes in? It's because of the oxygen. Your car uses a lot of O₂ to burn that pound of gasoline, and some of that oxygen becomes part of the CO₂ emitted. You can review the math here.

So that trip to the store to buy a loaf of bread, bag of dog food, quart of milk or bottle of wine probably put a pound or more of CO₂ into the atmosphere. That is likely as much as all the CO₂ emitted by all the processes involved in growing, manufacturing and packaging that product, and transporting it to your local store.

That is what causes global warming.

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These posts are thoughts that have occurred to us here at GCF Associates and Global Climate Fund. Feel free to contact us if you have any questions or ideas for future posts.

environment energy climate change global warming