Wednesday, April 22, 2009

Battle over...

While we were all fascinated by torture memos and Susan Boyle, I think the EPA just cemented the future of ethanol.  By declaring GHGs to be under their jurisdiction, they essentially removed the whole argument from the "politically inert" file.
For now,  the finding will mostly put pressure on Congress to pass its own greenhouse-gas rules instead. Ed Markey, who's co-sponsored the big climate and energy bill in the House, put it bluntly on Monday: "Do you want the EPA to make the decision or would you like your congressman or senator to be in the room and drafting legislation? ... Industries across the country will just have to gauge for themselves how lucky they feel if they kill legislation." Even Republicans like Ohio's George Voinovich have been pondering much the same thing. As much as some members of Congress might prefer to kill cap-and-trade and ignore the climate issue entirely, that's not an option at this point. [More]
Although I would much prefer a carbon tax - and there still might be faint hope for that much more efficient Pigovian approach - I suspect the enormous bureaucratic employment possibilities of a cap-and-trade system to be a more likely outcome.

So what to do right now?
  1. Buy farmland.  (Of course, I always think that's the right answer).  Seriously, by granting this considerable boon to ethanol, we may save that industry.  I think any dip in land prices will soon revert to escalation.
  2. Invest in energy-saving stuff when replacing equipment.  Fuel and electricity are about to get real costly.  Take a harder look at less tillage.
  3. Finagle a seat at the various tables.  There will be boards and oversight regulatory bodies galore. We need some producers to show up there.
Two schools of thought hold that regulating GHGs will impact the economy in opposite ways. I have no idea, as we have not been particularly good at predicting the economy lately.
A new carbon regulatory regime could basically act to accelerate obsolescence of dirty technologies. Consumers and businesses would be encouraged to scrap less efficient machines and invest in cleaner automobiles or homes or appliances sooner. Given the slack in the economy at the moment, it would be all to the good if everyone decided that now was a good time to start preparing for a world in which carbon costs money. It's regulation as stimulus. [More]
You can place your bets how you think this will play out, but it looks pretty clear Congress will not be able to ignore this issue much longer.


Brian in OH said...


I guess I'm trying to dry out my fields by throwing all these buckets of cold water on your stuff. Sorry, I'm really not that negative of a person. But a guy's gotta do what he's gotta do. Anyway...

Don't count your chickens - the great State of California is about to officially report that corn ethanol is a loser for GHG reduction. This is supposedly a precendent setter for the Feds.

I have never trusted the methodology of these calculations, so I googled the above and ended up with a pdf of Cali's EPA draft report on corn ethanol. I couldn't go through all the math, but one example is that they estimate around 8 gallons of diesel per acre to grow corn. Anyway, about 30% of the ghg increase they claim from ethanol comes from land use changes as corn prices rise. They explain this in a one-line footnote, saying they got the figure from the Purdue Dept of Agricultural Economics.

And here I had been thinking so highly of Purdue.

Ol James said...

Carbon Tax, Carbon Credits and me these represent the same things that put Brenie Madoff in jail, and contributors in the poor house. I can not for the life of me understand why or how the profitability of a corporation or a "group" can be a direct indicator as to the improvement of the environment.
If you feel guilty about driving a gas-guzzler, plant a tree yourself. Don't drive it as much.
We as individuals can do more to improve our environment. Far better than the "experts" and "advisor's" in D.C. who are notably and most times out of touch with the true issue.
Just because someone is smart, don't mean they have any sense.
Hope yall are able to start planting.

John Phipps said...


Please don't worry about disagreeing with me. I can always cry myself to sleep...

Hadn't heard about the CA study - I'll dig it up.


There are a zillion ways we all as individuals could make a difference, but we don't. I agree with your reasoning, but we've been trained to wait for the treat of the stick.


I'm hoping for Sunday to commit premeditated planting.

Wait, when's the next rain system?

Ol James said...

Hey Brian-N-OH, Like you the math just about put me to sleep. The biggest thing I got from the abridged version I read was this. Kal-lee-forn-eh-a,(The Gubber-nators pronunciation), EPA couldn't rightly say that Ethanol was leading to a reduction in atmospheric gases, like CO2 and the like. Mostly because it took so much coal to run the power plants that produced the electricity to run the refineries to make the Ethanol...hmm.
I wonder if there is some way they can take some of the distillers grain that is left, dry it out and burn it to fuel a steam plant?? Like a corn furnace. Solves 2 problems.
1)- Plant can produce their own electricity.
2)- Distillers Grain that could not be fit for consumption for feed can be used and not introduced into the food chain.
3) ...but then again they might have to set up a CZAR for this....
I aint the sharpest tool in the shed, mainly because I'm worn out.

Anonymous said...

I agree with your comments on reducing tillage for energy conservation, but under this carbon program isn't it fair to assume much higher prices for fertilizer, herbicides and drying fuel. What about costs for manufacturing machinery and replacement parts.

John Phipps said...


I agree - everything will be higher, as we discovered when gas prices shot up. When costs rise, I think it is safe to say production will have to decrease in order to get prices sufficient to cover those costs.