Production of corn ethanol as an automotive fuel source should cease

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Article Highlights

  • Corn ethanol is clearly inferior to gasoline as a fuel source for automobiles and provides 27% lower fuel economy.

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  • Growing corn for fuel requires significant amounts of fertilizer & pesticides that pollute soil, aquifers & waterways.

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  • The reality is that ethanol has played almost no role yet in reducing US dependence on foreign oil.

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  • Congress needs to roll back its mandate. It’s time to stop throwing our tax dollars at ethanol.

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Among all the problems that have surfaced as a result of using ethanol as an alternative to gasoline, one is especially troubling. It can damage automobile engines and fuel systems.

The Environmental Protection Agency’s (EPA) case for E15, a fuel blend consisting of 15 percent ethanol and 85 percent gasoline, has completely fallen apart, as evidenced by the recent report from the American Automobile Association (AAA) that E15 can cause accelerated engine wear and failure, resulting in costly repairs for unsuspecting consumers.

The AAA’s report has again raised the question of whether Congress should roll back the mandate requiring escalating production of ethanol, mainly from corn. The answer is, increasingly, yes.

The Renewable Fuel Standard, which Congress enacted in 2005, originally projected that by 2010 the advanced biofuels industry would have taken off. But that has not happened due to many economic and technological barriers that severely limited ethanol’s effectiveness as a fuel.

Cellulosic ethanol made from wood chips, switchgrass, and other sources is still not viable. Consequently, corn ethanol is the only domestically produced biofuel that is available in large quantities to meet the mandates.

Corn ethanol is clearly inferior to gasoline as a fuel source for automobiles. Despite a 51-cent-per-gallon tax credit to companies that blend ethanol into gasoline, ethanol costs about 70 cents a gallon more than gasoline on an energy-equivalent basis. Instead of helping consumers, ethanol provides 27% lower fuel economy than gasoline.

Realistically, you have to burn a lot more ethanol-based fuel to create the same amount of energy to power your car, which has unnecessarily driven up the cost of operating a vehicle.

"The reality is that ethanol has played almost no role yet in reducing U.S. dependence on foreign oil." -Mark J. PerryAnd there are serious long-term adverse environmental implications from using corn ethanol. Growing corn to make fuel requires significant amounts of fertilizer and pesticides that pollute the soil, underground aquifers and waterways. The National Research Council has determined that corn ethanol uses significantly more water in its production cycle than gasoline.

Over the years, the ethanol lobby has claimed that ethanol would help America achieve energy independence. But the reality is that ethanol has played almost no role yet in reducing U.S. dependence on foreign oil.

So far, neither the Administration nor Congress has confronted the fact that 40% of the U.S. corn crop is used to produce ethanol, which has increased retail food prices and strained family budgets in their never-ending struggle to put food on the table.

Yet the EPA has twice denied requests to waive the ethanol mandate, most recently in November, even though the corn crop was the smallest in six years due to a severe drought last year in the Midwest.

As the ethanol mandate artificially drives up the production of corn ethanol, more and more people in this country and abroad will have to dig deeper in their pockets to pay for food, underscoring just how misguided the push for ethanol has become as the economy struggles to regain its footing in a sub-par recovery.

The first step to adopting a more sensible ethanol policy is to halt the production of E15, since it is caustic and can ruin car engines, while doing nothing to moderate gasoline prices or improve the environment.

The Renewable Fuel Standard requires escalating the production of ethanol, ramping up from 13 billion gallons this year to 36 billion gallons by 2022. Unless cellulosic ethanol becomes available, that level of production would require switching the nation’s entire corn crop to the production of corn ethanol.

That would be a recipe for disaster. Congress needs to roll back its mandate. It’s time to stop throwing our tax dollars at ethanol.

Mark J. Perry is a professor of economics at the Flint campus of The University of Michigan and a scholar at The American Enterprise Institute.

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