When biofuels are FUN!

You have to love it when the best laid plans of bureaucrats gang agley, as the Gaels would have us say.

The latest example to have come my way is the tale of ethanol in the US fuel pool.

The US EPA introduced a Renewable Fuel Standard, which required refiners and importers to add a predetermined quantity of ethanol to every gallon of gasoline. 

When they mix ethanol into gasoline, or import fuel already blended with ethanol, the refiners/importers get a credit from the government. That credit can be sold to other companies that don’t blend ethanol. To monitor compliance, each gallon of ethanol is assigned a 38-digit Renewable Identification Number, or RIN. Six billion of them were generated in the first six months of this year.

RINs started in 2005, when the Bush administration passed an energy bill setting out renewable fuel standards. The law was broadened in 2007, creating a requirement for the amount of biofuel to be blended annually. In 2013, refiners and importers are required to blend 13.8 billion gallons of ethanol, up from 13.2 billion last year. For 2014, the figure is 14.4 billion.

But there is a problem - the quantity of gasoline sold has been falling in recent years.  Cars have become more fuel efficient, and Americans are driving less.  You can only stand so much ethanol in the fuel.  Too much, and fuel systems gum up, both at the pump and in your car.  So the poor gasoline blenders have to put more ethanol into the fuel than necessary, or buy a credit for not blending ethanol. They have been buying credits like crazy, to avoid gumming up the works.

But this is America, right? They aren't all like George Bush.  Someone saw it coming.  They bought up credits.  Now they are selling them into a buyers' market, and making a big fortune.  Who is "they"? The banks, of course, and a few Mafia guys, and anyone who could think faster than the Government.

The net result is that fuel prices are rising even as shale gas and shale oil bring down input costs.  The US EPA is appalled. The official responsible is reported as saying “The last thing we wanted in implementing this program was to get price increases for the consumer.”[New York Times]

Yet another Green Dream bites the dust of reality!

 

The damage done by the carbon mob

I am giggling slightly about today's tale of China holding up a HUGE order for Europe's biggest airliner, on the grounds that they don't like the EU's carbon tax on use of the European airspace. The tax will come into effect next January.

The EU has been allowed to get away with taxing things that aren't theirs for too long. The unelected gougers that inhabit Brussels seem to think they own the world. Because they are essentially not answerable to anyone, there is no one to throw the out of office for raising taxes that shouldn't be raised. "No taxation without representation" is quite a good principle, which has been discarded in the name of European unity.

Their desire to tax things carboniferous, all done with the finest of motives, namely to save us from ourselves, is having an effect on all of us. Our National Treasury wants to introduce a carbon tax. Part of the thinking behind their proposal is that some nations are likely to introduce sanctions unless we have a carbon tax. Some nations? Sure - all the European nations. Their trade is suffering because they have to pay a carbon tax. Why should they make themselves uncompetitive and us more competitive? Their answer - we should be equally uncompetitive.

Never mind that all these good intentions achieve absolutely nothing. Look, for a moment, at the world's use of fossil fuels. Since 1998 it has increased by 34%. 1998 is a good year to start - because that was the year the Kyoto Protocol, designed to limit carbon emissions, came into being. Limit? Carbon emissions have increased faster than ever.

Even worse is the fact that the good intentions are having some awfully bad effects. In their desire to reduce reliance on fossil fuels, some first-world countries are encouraging the use of biofuels. They are even subsidizing biofuel production.

The food production of the world is growing faster than the population. This would be marvellous, except for the fact that the food available to feed people is actually decreasing. The result is a global surge in the price of food. We first saw this back in 2007-8. Most rational people thought the message had gotten through to Governments - do NOT subsidize biofuels.

It seems us rational people were optimists - Governments are more stupid than we thought. The subsidies continue, and food becomes much more expensive as a result. Everything that grows is being turned into alcohol - wheat, maize, rice, sugar, sorghum, even casava.

The real problem, however, is the thesis that carbon dioxide is bad for us. So ingrained has this thesis become, that excessive carbon emissions are now thought to be worse than starvation. The carbon mob are actually responsible for global malnutrition, thanks to their misplaced desire to save the planet.

Perhaps the cancellation of a megaorder for planes will finally be sufficient for them to wake up to reality - but I doubt it.