Take ethanol, for instance. It was the choice fuel for some of the first combustion engines. In the 1820s, Samuel Morey used an ethanol blend in his experimental internal combustion engine. Due to the rise of steam power, ethanol remained an obscure fuel until 40 years later, when the internal combustion engine took off thanks to a more efficient design by German inventor Nikolaus Otto.

But also around that time, America discovered a cheap, domestic oil supply, which would compete with ethanol and later become our preferred fuel despite ethanol’s early success. Even Henry Ford thought ethanol would withstand the test of time. He designed his Model T to run on ethanol, going so far as to call it “the fuel of the future.”

Now, 100 years after the first Model T took to the roads, our leaders are spouting the same tired slogans. Our reliance on oil has not been clipped. Instead, we are faced with new debates over ethanol’s true energy output and its overall effectiveness as a cheap, efficient alternative to gasoline.

While technology can’t always help these old ideas become modern-day miracle cures for oil fever, there is one ancient technology that could provide clean, renewable energy for the planet’s 6.6 billion people.

Geothermal energy has been used for centuries. It helped provide the Vikings with heat and hot water when they settled in Iceland, and it is still a widely used energy source. Geothermal energy produces more than 25% of the power in Iceland, and is used to heat a majority of the homes in the Scandinavian nation.

But that’s in Iceland. For the rest of the world, it will take a little innovation. A 2006 report issued by the Massachusetts Institute of Technology claims that it would be possible to affordably generate 100 gigawatts of electricity or more by 2050 with a $1 billion investment. But it will take a technological boost to make this possible.

For the rest of the world where volcanic activity is minimal, there are two options to extract steam from the earth: water pumping and drilling. Water mixed with chemicals can be pumped into the ground to enlarge the natural cracks and passageways, creating big enough steamholes to effectively run large turbines.

Then there’s drilling. Thanks in part to our never-ending quest for oil, drillers have developed the equipment and techniques to drill farther into the Earth’s crust than ever before.

If we can tap into the deep geothermal wells all over the world, the result will be clean, cheap, reliable power. And that’s an old technology we can live with.

California’s New Energy Boom

Meanwhile, a little closer to home… The state of California and electricity love to make headlines together. It seems there’s never enough juice to go around on the West Coast. But all of this could soon change, thanks to a renewed interest in an efficient, green energy source.

Geothermal energy accounts for about 9,300 megawatts of the world’s electricity. That adds up to 60 million people in 24 countries who are getting their power from the Earth’s heat.

In the United States, more than 2,800 megawatts of electricity from geothermal plants supplies four million people in Alaska, California, Hawaii, Nevada and Utah. Six percent of California’s power comes from geothermal sources, where 15 new projects are under development.

Progressive, nuclear-free California is the perfect place for geothermal expansion. The state of California will require 20% of electricity sales to come from renewable resources by 2010. In 2006, 15% of all electricity used in California came from geothermal, wind, solar and small hydro.

On top of this, The Geysers in Northern California is the largest geothermal development in the world. And there’s one small company that’s paving the way for geothermal expansion.

You may be familiar with Calpine Corp. (NYSE:CPN). Calpine became the world’s biggest geothermal power provider in the late 1990s after completing the largest IPO ever for an independent energy provider in 1996.

This alternative energy star declared bankruptcy in 2005 and was eventually de-listed from the NYSE. And as this former giant rebuilds, one tiny competitor is preparing for operations at The Geysers, as well as a second location on the West Coast.

Unfortunately, I can’t divulge the name of this bulletin board gem in this forum. It’s just too small and too illiquid to reveal to a large audience.

Currently, the company is pursuing two projects that are under development. One of them is a $100 million geothermal facility at The Geysers in Northern California that is projected to go online sometime before the end of the decade. This will be just what California needs to fulfill its green energy needs as 2010 approaches.

We’ll be watching to see how the power giants respond to these developments. Buyouts and consolidation could be eminent in the near future. We could even see geothermal power expand beyond areas like The Geysers. Modern technology and advanced drilling should allow these kinds of operations to spread to locations where geothermal power was thought to be impossible.

Best,
Gunner

July 19, 2007

The Newest Old Idea in Energy was originally featured on Whiskey and Gunpowder

With simple language, and in a disarming and folksy manner, the man from Shell would explain things that related to fuel usage, like how proper tire inflation was good for your gas mileage. Or he would discuss how “jackrabbit starts” wasted gasoline. Over a period of time, there were a variety of topical ads along those lines. If you were somewhat savvy about driving an automobile, there was nothing particularly new or revealing in the message. But if you were what we might characterize, with all due respect, as the “average consumer,” blissfully dwelling in energy La-La Land, then the Shell Answer Man offered some good advice. Well, it was good advice if you followed it.

John D. Hofmeister

And so today we meet John D. Hofmeister. He is a nice-looking, pleasant-sounding fellow who happens to be the president of Shell Oil Co. And he is in the midst of a 50-city lecture tour, on behalf of Shell, giving speeches with a title along the lines of “How the U.S. Can Ensure Energy Supply for the Future?” On Feb. 8, 2007, he brought the show to Pittsburgh.

First of all, Thank you, Shell Oil Co., and thank you, Mr. Hofmeister. No matter what else I say in the following two-part commentary (and frequent readers know that I will have a few things to say), I certainly appreciate that a large company like Shell would make the effort to hold what amounts to a “national energy discussion.” And it says something important that a big, publicly traded company like Shell would send no less than its president out on the road to give the pitch. I suspect that such a senior corporate officer might have a few other things to do, like run Shell Oil. But then again, educating the public about the nation’s energy supply and answering peoples’ questions on the subject might just be more important over the long term than squinting at a few more spreadsheets full of obscure data or buttering up the stock analysts.

A Well-Traveled Road

And what a road Mr. Hofmeister has traveled in the past year or s from Miami to Minneapolis, New Orleans to Irvine, Seattle to Washington, the National Press Club to Harvard Business School. The guy gets around. He calls it a “speaking tour,” of course, because he is giving speeches. But he also calls it a “listening tour,” because he takes questions and offers answers, however well rehearsed. (It’s OK, really. Shell has to be careful not to run afoul of the Securities and Exchange Commission or its many volumes of regulations. So everything has to get scrubbed by the lawyers.)

The typical gig involves a visit to some burgh where Mr. Hofmeister has a lunchtime speech scheduled before a local assembly of worthies, such as the World Affairs Council of this hamlet or that village or town. Also on the schedule, time permitting, is a morning visit to an area high school or college to meet with the young people and hold give-and-take sessions with those inquiring minds. And often as not, the indefatigable Mr. Hofmeister holds a “town meeting” later in the day, at which forum just about anybody can (and ofttimes does) show up to make caustic attacks on the oil industry, if not to bellyache about the price of gas.

In Pittsburgh, for example, one precocious high school student asked one of the most painful of all questions that any oil company executive can hear: “How much do you get paid, Mr. Hofmeister?” Ooooooh! That’s what I compare to a hot welding spark dropping down your shirt. But Mr. Hofmeister gave the nosey kid a good answer: “I get paid more than a rookie player for the Pittsburgh Steelers, but less than [Steelers quarterback] Ben Roethlisberger.” Not bad, Mr. Shell Answer Man, not bad at all.

Just by way of payroll perspective, a rookie player for the Pittsburgh Steelers makes more money than a federal judge, albeit without the lifetime tenure. And although the Steelers’ player No. 7 did steer the team to a Super Bowl championship back in 2006, Ben Roethlisberger has a disturbing habit of riding a motorcycle without wearing a helmet. How smart is that? Yet the Steelers quarterback gets paid more than the guy who runs Shell Oil Co.? Go figure.

And the man from Shell might have added that he gets paid to manage a company that produces real energy and industrial products that people buy and use, and that he makes a heck of a lot less than most of the senior guys at places like Goldman Sachs or the myriad rich guys who run those Greenwich- or London-based hedge funds. Really, dear readers, how much gasoline or engine lubricant have you ever bought from Goldman Sachs, let alone from those Greenwich and London hedge funds? But I digress.

The Edge of Secure Supply

The public speaking coaches will tell you that it is often good to begin your speech with a story to gain the attention of the audience, and Mr. Hofmeister began his lunchtime talk with one heck of a tale. In the aftermath of hurricanes Katrina and Rita in 2005, almost all of the U.S. Gulf Coast refineries were down due to flooding and other storm damage. Shell had 300,000 barrels of refined product in storage at its Baytown, Texas, refinery, which was essentially the only supply available to the entire Southeast region, but there was no electricity with which to run the pumps. Whoops!

Shell employees and contractors were working feverishly to rig up electric generators at the Texas facility, but it was a race against time, over a 48-hour period, until the Plantation and Colonial pipelines — the major trunk carriers for refined product between Texas and the Southeastern U.S. — went dry. If word escaped of the predicament, Shell executives believed that many members of the consuming public would have panicked. Then “panic-buying” would have immediately kicked in and rapidly drained whatever fuel was left in the supply system. The entire U.S. Southeast, home to about 60 million souls, could have been caught in a situation in which there would be no fuel available anywhere. It fell to Shell’s Mr. Hofmeister to call the U.S. Secretary of Energy and deliver the bad news.

But like the cavalry arriving near the end of a John Ford Western, Shell’s hardworking people hooked up the Texas facility with electric power, with all of about 12 hours to spare. Shell started pumping gas into the pipeline system. There were, you may recall, spot shortages of fuel in the U.S. Southeast, but no regional lack of product. Still, as Mr. Hofmeister put it, it was a close call and the U.S. was and remains “on the edge of secure supply.”

Shell’s View of the World

In his comments in Pittsburgh, and in his talks to other groups across the U.S., Mr. Hofmeister has noted that he is “president of a company that creates a product that consumers don’t want to see, touch, taste or smell, even though they buy it by the gallon day after day.” At the same time, he notes, the mission of Shell is to “renew the American industrial energy base in order to grow energy supplies in this country — which are ample.” Mr. Hofmeister continues: “We are deeply, deeply invested in the hydrocarbon economy and there is no short-term exit from the hydrocarbon economy, unless we want to suspend economic growth and development.”

Mr. Hofmeister, in the course of his tour, has on numerous occasions amplified these comments. His talks identify to listeners a key dilemma of our time, that “we are the beneficiaries of an industrial age, having given way to a post-industrial age, having given way to an information age, in which the world is ever more seeing the role of information and the manipulation of information as part of the business model upon which we will build wealth creation.” But the Shell man has noted, “Sustained growth of the post-industrial information era can only occur predicated upon continued development, and in some cases redevelopment, of the industrial infrastructure which many people think we have moved beyond.”

Redeveloping Industrial Infrastructure

In the course of his talk in Pittsburgh, as in his other speeches in many other cities, Mr. Hofmeister addressed the litany of present and future potential energy resources. He spoke at length, as you might expect, about oil and natural gas.

Considering that the focus of the man from Shell was on explaining the need and urgency of developing and redeveloping energy and energy-related industrial infrastructure, it was odd, certainly to this correspondent, that he did not address the concept of depletion. Most people tend not ever to have heard of depletion, let alone to understand it. In fact, I have met many people who think that oil wells just gush away, forever and ever, world without end, amen. They say things like, “If only those damn oil companies would uncap those wells they have shut in down in Texas, we’d have plenty of oil.” Oh please, dear readers, can you feel my pain? But then you explain to these misguided souls how depletion works. Then, unless they are total idiots or utter ideologues (and believe me, dear readers, there are some total idiots and utter ideologues out there), they understand why it is necessary to go out and drill new wells to replace the ones that have declined. So memo from King to Hofmeister: Discuss depletion, even if there are idiots and ideologues who just won’t get it.

Mr. Hofmeister’s emphasis was on the political fact that about 85% of the U.S. Outer Continental Shelf (OCS) is off-limits to oil and gas exploration, as are large areas of federal- and state-owned lands in the U.S. These areas have significant potential to become productive areas for oil and gas, but the environmental opposition is such that the political will is lacking to lease any blocks and spud any wells. And even if, let’s say tomorrow morning, the political will magically appeared for OCS development, it would take much time and investment for any productive potential to come to fruition. Considering that it takes between 10-15 years to begin to develop an offshore province, the decision to open or not to open up the U.S. OCS will impact the energy destiny of the country in 2020 and afterward. In my view, people in the future will look back and think rather unkind thoughts about us for our current inaction, but that is another subject for another time.

To his credit, Mr. Hofmeister acknowledged that drilling the OCS will not “solve” the U.S. energy dilemma. As an oilman, of course, he painted a favorable scenario for future hydrocarbon production from the OCS. But the guy clearly is smart enough to understand (and honest enough to say) that drilling up the OCS is not the answer to the nation’s energy problems going forward. The take-away point was the geologically correct observation that future oil and gas production from the OCS has to be a part of any overall U.S. energy strategy. It will be, of course. It is just a question of time, and how desperate the U.S. becomes for oil and gas as in the future as imports inevitably decline from other parts of the world. It’s that depletion thing.

Mr. Hofmeister spoke about Shell’s efforts in developing other forms of hydrocarbon fuels, as well. These include the “Alberta oil sands” (even though we all know that the correct description is “tar sands”). He discussed the future of liquefied natural gas (LNG) and the importance for the U.S. of having the facilities in place to import LNG from overseas. He discussed the use of domestic coal, noting that “The word ‘coal’ is usually associated with the word ‘dirty.’” The point was not lost on an audience in Pittsburgh, most of whom above a certain age could tell you a few things about dirty old coal. But Shell is focusing quite a bit of investment on a coal-related concept called integrated gasification coal conversion (IGCC), which allows for much cleaner combustion or conversion of the black rock, with the opportunity to capture and sequester the carbon dioxide byproduct. Shell has 15 IGCC projects ongoing in China. And among the other coal-related processes that the company president mentioned were coal-to-liquid (CTL), with which Shell is also well along in China. I have written at length about these energy resources, including Shell’s methanol projects in China.

Other areas of interest and investment by Shell include Colorado oil shale, in which Shell has pursued a 20-year research project. But any major investment in oil shale is, according to Mr. Hofmeister, “still many years away” for Shell. Mr. Hofmeister did not say it in so many words, but the tone of his voice seemed to emphasize the quantity of “many.” So don’t hold your breath. Oil shale has been the “fuel of the future” for a long time, and still is. And Shell is also investing in technology to upgrade heavy oil, of which there are voluminous amounts in the crust of the Earth. Again, this will be a technological stretch that plays out over many years.

According to Mr. Hofmeister, Shell is a major player in what he calls “second-generation biofuels,” meaning ethanol-derived “from nonfood-based cellulose material.” This includes plant stalks, wood chips, and even municipal waste. Why no enthusiasm for corn-based ethanol? Mr. Hofmeister has, on other occasions, explained it thus:

“I got 48 letters from attorneys general (in 2006) accusing us of price gouging during the course of the last 12 months. It’s not fun to get accused by attorneys general in 48 states of price gouging when in fact we’re working very hard on bringing supplies. So the biofuel, we believe, stretches the gas supply, but the cellulosic avoids the cost of food going up. What I really don’t want to see is 48 letters from attorneys general accusing us of raising the price of food in addition to the price of gasoline because of the extensive use of corn and sugar.”

Shell is also investing in producing energy from solar films and fuel cells, and the company even produces in excess of 300 megawatts per day of electricity from windmill farms in seven states. So Shell has quite an energy aperture.

Energy Conservation

But simply focusing on future energy supplies is not enough, states Mr. Hofmeister on behalf of Shell. Shell believes in promoting a “culture of conservation”:

“We need a culture of conservation. Conservation does not come from turning the thermostat up a bit in the summer and down a bit in the winter. Conservation comes from the minds and the hearts of our engineers and our designers who can rationalize energy efficiency and who can design vehicles, homes, buildings, and appliances in ways in which energy efficiency is increased on an ever-constant-improvement basis. A culture of conservation drives energy efficiency forward for generations to come. We believe that a culture of conservation has to start with education, as does this whole backdrop of energy efficiency and energy education. Shell supports the notion of working with public policy leaders on a rational framework across the whole spectrum of energy development, but, in addition to that, supports the development of a school-based curriculum to educate our young people for generations to come about how important energy is to our life, to our economy, and to our standard of living,”

So in summary, according to its president, Shell Oil Co. is looking at and investing in production of traditional hydrocarbon sources of energy as well as developing novel means of producing energy supplies from alternate forms of carbon. And Shell is working on innovative energy alternatives, and supports conservation efforts. The company’s top executive is out on the road putting a human face on its corporate vision and interests, and giving good speeches about important topics.

In Part II, We Question the Shell Answer Man

So far, so good. And in Part II of this article, we will take things a few steps further and pose some questions to the Shell Answer Man.

Until we meet again….
Byron W. King

February 22, 2007

The Shell Answer Man, Part I was originally featured on Whiskey and Gunpowder

Oh I wish I had a barrel of rum, and sugar 3,000 pounds,
A college bell to put it in, and the clapper to stir it ’round,
I’d drink to all the good fellows who’d come from far and near,
I’m a rambling, gambling, Hell of an Engineer! Hey!

WE RECEIVED SO MUCH e-mail about last week’s article on using corn to produce ethanol that I was actually humming the whiskey-drinking Georgia Tech fight song to myself. Those of us who put together Whiskey & Gunpowder are fortunate to have such a great and thoughtful group of readers. Thank you for taking the time to write. I just wish that you would tell us your location (state, province, or foreign country) when you send us e-mail. Allowing for some editing due to space, and my comments on occasion, here is what some of "the good fellows" (and sisters) who wrote had to say:

From Herbert in Ohi "If agricultural product-based material becomes the source of transportation fuel, the price of oil will set the price of food. We have been warned. At least we can’t claim it will fit into the law of unknown consequences when it happens."

From Betty, Location Unknown: "Why doesn’t The New York Times say something about the fact that corn is one of the less-efficient sources of ethanol. It has to be processed twice as much as other sources, such as prairie grass, which will never compete for food dollars. The fact is that corn is far likelier to go up in price than it would if not sought after as a substitute for gas, and that nobody speaks about the greed of the agricultural industry. Signed, Disgusted."

Byron’s Comment: Betty, you will have to ask the editors of The New York Times why they do what they do. But if anyone from that newspaper ever writes us a letter, we will publish it. And I do not believe that there is an economic method, just yet, for transforming prairie grass into ethanol. But I know that some very smart people are working on it.

From Gary, Location Unknown: "First of all, again, thank you for the BEST commentary letter on the Internet even when you do get a little conservative! A major thanks for forthrightly challenging the corn-ethanol crowd. That position ranks as one of the most incredibly immoral decisions the U.S. and Europe have made. The production of ethanol from a valuable food crop, with an effective loss of several times the energy value as food versus the energy value as ethanol burned in internal combustion engines, is indefensible. This is true even ignoring [the] point of how little the impact [ethanol will have] in reducing our oil requirements. However, the crowning blow to the logic is the fact that the corn-to-ethanol cycle, when fully evaluated, uses more fossil fuel energy than that resulting from the produced ethanol."

Byron’s Comment: Try this on for size, Gary: When you compare the energy content of a gallon of ethanol versus a gallon of gasoline, you are just comparing the unburned fuel itself. Ethanol contains less than 60% of the energy content of gasoline. So the physical chemistry is what it is. But when you burn either ethanol or gasoline in an automobile engine, your overall energy efficiency plummets even further. Less than 15% of the energy that is released in the cylinders during internal combustion ever reaches the wheels. And much of the energy that is exchanged where the rubber meets the road is used to accelerate several thousand pounds of metal and plastic. The ultimate fuel efficiency that results from moving the human driver and passengers in your standard passenger car is down around 1% or 2%. That is just pitiful, really.

From Ted in Minnesota: "The entire 2004 U.S. corn and soybean crop, converted to biomass fuels, could replace about 10.41 billion gallons of petroleum (7.6 billion as ethanol and 2.81 billion as biodiesel). Petroleum is measured in 42-gallon barrels; the 10.41 billion gallon biofuel total would be equivalent to 248 million barrels of petroleum. The U.S. consumed about 7.49 billion barrels of petroleum in 2004, or about 20.5 million barrels a day. This means that the total biofuel potential of the record 2004 U.S. corn and soybean harvests would offset about 12 days of U.S. petroleum consumption, or about 3.3% of our total yearly petroleum consumption. Given that most of the U.S. corn and soybean crop is already committed to other uses, this analysis indicates that biomass-based fuels will have a negligible role in reducing U.S. petroleum consumption, which in turn underscores that replacing petroleum in the U.S. economy will be a monumental challenge."

Byron’s Comment: This is an excerpt from a much longer letter that Ted included in his e-mail to us, referring to a summary of energy balances that he wrote and submitted to the Oil & Gas Journal in July 2005.

From Nick in Iowa: "I am a farmer from Iowa that just read your article about the ethanol energy story and wanted to clarify a couple of things. First, it’s unlikely that ethanol will cause U.S. consumers to run short of food. There is a large amount of a byproduct called dry distillers grains (DDS) from the production of corn-based ethanol. It’s a made-to-order cattle feed and can also be fed in smaller quantities to swine and poultry. Feeding livestock will become a little more expensive, but will not contract in large measures. Also, the raw grain price in consumer foods is minuscule. Typically, the price of raw grain makes up 5% of the consumer retail price. For example, the cardboard box costs several times more than the corn in the retail price of corn flakes. Overall, retail food prices could creep up a little, but are unlikely to cause any severe rationing at the grocery store.

"Second, the impact on the U.S. balance of trade won’t be that great. There’s no question that U.S. exports of corn will fall, possibly dramatically. However, large exports of cheap corn have had little overall impact on the trade deficit, compared with the large imports of high-priced consumer goods and, of course, huge quantities of high-priced petroleum. Granted, ethanol will not improve the trade deficit to any great extent, either.

"Third, the tax breaks provided to the ethanol industry pale in comparison with the massive expenses the U.S. Treasury lays out to subsidize the high-production farm programs. High-priced commodity prices enable farmers to make decisions about their farms and livelihoods from the market, and not the government. I am a free-market person and am no advocate of the farm programs. However, I also do not agree with subsidizing the petroleum industry through our military budget. If the true cost of foreign oil were priced on the retail pump, ethanol’s true value would be easier to ascertain.

"Finally, I do agree with you that corn-based ethanol is only one small part of the energy equation. This nation obviously needs a more realistic and comprehensive energy policy, regardless of the impacts of ethanol. Even Iowa farmers know that petroleum prices are still very integral to our cost structure in fuel, pesticides, and fertilizer. I appreciate your continued effort to keeping everyone’s focus on the big picture of energy, and I always look forward to your next essay."

Byron’s Comment: Thank you for your kind words, Nick. You are making an important point about DDS being used as cattle feed. Many ethanol plants are located near cattle feeding operations. Thus, the "mash" that is left over is being sold as cattle feed. But no less an authority than the CEO of Tyson Foods recently commented that U.S. consumers would soon be seeing an increase in the price they pay for meat and meat products due to the rising cost of grain. A recent news article from the Associated Press noted:

"Ethanol plants and foreign buyers are gobbling the nation’s corn supplies, pushing prices as high as $3.40 a bushel, the U.S. Department of Agriculture said Friday [Jan. 12, 2007]. Farmers have not seen prices this high in more than a decade."

I sympathize with your comments about the state of the "free market" in the U.S. There are so many monetary, fiscal, legislative, and regulatory aspects to the U.S. economy that it is hard to know where regulation stops and the free market begins. To paraphrase Sigmund Freud, "What does the free market really want?" Nick, you are not alone in your view on this. Read the next letter.

From Roger in Delaware: "We all know ethanol is next to useless as fuel. Why didn’t you bring up the point that the only reason these plants are being built is they are government subsidized? The free market has no interest at all in alcohol as fuel, because it just doesn’t work. This whole thing is another government fiasco by the liberals and neocons. Private industry has no interest here."

Byron’s Comment: Roger, I think you are overstating the case. Ethanol has many good uses. There is even a NASCAR program to run racing cars on ethanol. Yes, there is a lot of government subsidy to the ethanol industry, such as the mandates to use ethanol as a fuel additive, even if it gums up your engine. And there are tax breaks for ethanol, such as exempting it from highway taxes, as if vehicles that use ethanol do not use the same highways as the rest of us. But it is clear that a lot of private funding is moving into ethanol production. So let’s follow the money. Are we watching the formation of an "ethanol bubble" to mirror the tech bubble of 1999-2001, or the housing bubble of 2003-2006? All I can say about that just now is to be careful about investing in things that you do not understand. The next letter makes the point.

From Joseph in North Carolina: "Ethanol on the first 10 billion gallons [of gasoline] per year is more about E-10 and less about E-85. Spot prices per bushel of corn are high, and so farmers will grow more, especially if they know they can get at least $2.50 per bushel. In North Carolina, farmers need a reason to grow something other than tobacco. Current spot prices are close to $4.

"Like you suggest, the ethanol supply is a drop in the bucket to U.S. [energy] consumption. Corn-based ethanol is just one small piece of the puzzle to U.S. energy independence. Some of those plants you mention may never get built or fail outright."

Byron’s Comment: These are good points, Joseph. The U.S. needs to have a serious national policy discussion about its future sources and uses of energy in general, and transportation fuel in particular. But I have heard otherwise serious people say really dumb things like, "We can run our cars and trucks on ethanol." No, we cannot do any such thing.

The fastest, cheapest, most readily available source of "new" energy supply for the U.S. economy is conservation and efficiency. That is one of the key points that I wanted to make in the article on the rush to construct ethanol plants and distill corn into fuel.

There are many other letters, and we will review some of them in Part II of this discussion. Thank you for reading Whiskey & Gunpowder.

Until we meet again…
Byron W. King

January 16. 2007

Letters to the Editor: Ethanol, Part I was originally featured on Whiskey and Gunpowder