Ethanol from corn – burning both money and oil
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Ethanol from corn: burning money and oil

US politicians have been subsidising corn (maize) production, and its conversion to ethanol, for years.  The idea is that it can be added to petrol where it both acts as fuel itself, and makes the petrol burn more efficiently and cleanly.  Since it is not derived from fossil fuel it should reduce greenhouse gas emissions and help reduce American dependence on Middle Eastern oil. 

Surely that’s worth the $1.4 billion annual subsidy that farmers in states like Iowa and companies like Archer Midland Daniels get every year.   Greenpeace and the nuttier type of tree huggers love it.  

Taxpayers may not be so keen.   The full costs of the subsidy are a good deal more than the direct subsidy itself.  By raising the price of corn they raise costs of food overall.  

Nor does it help the environment to pay to keep about 10 million acres of land growing corn, when they might otherwise  revert to nature.  

The real problem with ethanol from corn is that it requires fuel to make the corn.  David Pimentel a professor from Cornell has done the analysis [i].   An acre of U.S. corn can be processed into about 328 gallons of ethanol. But planting, growing and harvesting that much corn requires about 140 gallons of fossil fuels and costs $347 per acre, according to Pimentel. That is $1.05 per gallon of ethanol before the corn even moves off the farm. 

The energy economics get worse at the processing plants, where the grain is crushed and fermented. As many as three distillation steps and other treatments are needed to separate the ethanol from the water.   All these need energy.  

Adding up the energy costs of corn production and its conversion to ethanol, 131,000 BTUs are needed to make 1 gallon of ethanol which has an energy value of only 77,000 BTU. "Put another way," Pimentel says, "about 70 percent more energy is required to produce ethanol than the energy that actually is in ethanol. Every time you make 1 gallon of ethanol, there is a net energy loss of 54,000 BTU."

Overall ethanol from corn costs about $1.74 per gallon to produce, compared with about 95 cents to produce a gallon of petrol. "That helps explain why fossil fuels -- not ethanol -- are used to produce ethanol" Pimentel says. "The growers and processors can't afford to burn ethanol to make ethanol. Drivers couldn't afford it, either, if it weren't for government subsidies to artificially lower the price."

Subsidised food burning

"Abusing our precious croplands to grow corn for an energy-inefficient process that yields low-grade automobile fuel amounts to unsustainable, subsidized food burning," says Pimentel.   He knows what he is talking about.  He chaired a U.S. Department of Energy panel that investigated the energetics, economics and environmental aspects of ethanol production several years ago. 

Environmental damage

Since the production energy comes mostly from fossil fuels, ethanol isn't just wasting money but hastening the depletion of nonrenewable resources. Corn production in the U.S. erodes soil about 12 times faster than the soil can be reformed, and irrigating corn drains underwater aquifers faster than they are being replenished.  In Nebraska about 80% of the subsidised corn has to be irrigated by pumps fuelled from natural gas, and using water from the rapidly depleting Ogallala aquifer. 

The inefficiency and environmental damage becomes clearer if we imagine what would happen if all cars were fuelled by ethanol.  The average car travelling 10,000 miles a year on pure ethanol would need about 852 gallons of the corn-based fuel. This would take 11 acres to grow - the same amount of cropland required to feed seven people for a year. 

Government and producers disagree

Not surprisingly ethanol enthusiasts dispute Pimentel’s calculations.  A 2002 U.S. Department of Agriculture study found, "Production of corn-ethanol is energy efficient, in that it yields 34 percent more energy than it takes to produce it, including growing the corn, harvesting it, transporting it, and distilling it into ethanol."   However, the USDA is hardly neutral.  Its whole reason for existence is to find that agricultural subsidies of any sort are a good thing. 

Pimentel has responded and recently redone his calculations [ii].  He now finds that "about 29 percent more energy is used to produce a gallon of ethanol than the energy in a gallon of ethanol."   

So who should outsiders believe?    Enthusiasts who claim you get 34% more out than you put in, or sceptics who say that you get 29% less?   Maybe it does not matter.  They both admit that ethanol production involves converting massive amounts of energy from one form to another.  Whatever the USDA may say, the corn growers and ethanol distillers can't escape the second law of thermodynamics.  

Fortunately the bottom line is simple. If ethanol from corn is so cost effective, why does its production need federal subsidies? 

Jim Thornton. Nottingham, Jan 2004

16 July 2005. Brian Penttila writes:

There are MANY studies concerning the net-energy balance of biofuels including corn-based ethanol. A quick summary of various determinations of the net energy balance in recent research can be found at: 

Ten or more studies from different authors are reviewed in this 2002 USDA-sponsored study. The sponsors of these many studies were not ALL in the pocket of Archer Daniels Midland. Results from Pimentel's earlier work (showing a net negative energy balance) are inconsistent with the results of the majority of other studies.

 I'm not sure why you have a problem with subsidies. Nearly all modern US drug discoveries have been "subsidized" by research grants from the US government to biomedical research. Most  successful businesses develop from a period of loss to a period of profit. Small businesses need start-up money to survive until they become profitable.

Lastly, would you trust the analysis of a group devoted to alternative fuel energy analysis or an entomologist, like Pimentel? Did you know he wants to limit immigration because he's afraid the US will run out of food in the future? For example, take a look at this website:

Pimentel is on the board of directors (look towards the bottom of the page). Maybe THAT'S why he's afraid of corn-based ethanol. He must not be aware of the recent research showing that calorie restriction lengthens lives in almost all species studied to date.

Lastly, have you read ANY of the primary research articles in this field or are you another casual commentator with an axe to grind.

Brian Penttila


There is more to life than increasing its speed. -Gandhi


Jim replies: 

Thank you for the link to the USDA study I quoted.  It does indeed find that you get 34% more out than you put in.  I still don't think that justifies government subsidy.  


I wonder what Mr Penttila's background is.  I'm neutral - no axe to grind.  I'm an OBGYN doctor.  I agree some subsidies, such as money for research, are fine.  I just don't like paying taxes to destroy the environment.



[i] Pimentel D (September 2001) Encyclopedia of Physical Sciences and Technology.

[ii] Pimentel D (June 2003) Natural Resources Research. "Ethanol Fuels: Energy Balance, Economics and Environmental Impacts are Negative.”


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