Being green has been the biggest fad of the 2000’s. This “Hippie-ism” is making a resurgence in the hearts and minds of our culture, even though we still hold on tightly to our gas guzzling SUV’s, and complain when gas is raising, even though oil prices have fallen below $38. What should we complain about? Gas prices that have been peeking around $2 a gallon, or the fact that OPEC is looking at large-scale production cuts, and traders are buying and storing oil in hopes that it will rebound and they can sell for more?
The effects that oil is having on an all ready struggling economy is showing.
“Given that we’re likely to see quite a few rather poor fourth quarter earnings reports, downward pressure will continue to be exerted on oil, worries about the macroeconomic outlook will continue to constrain oil.”
says Victor Shum, an energy analyst with consultancy Purvin & Gertz in Singapore.
The demand is weak for oil. American drivers are traveling less miles. Saudi Arabia announced over the weekend that it would cut oil output by about 300 million barrels per day. While we’re still facing a grim economic future, this announcement could do good in the long term.
But all we hear about is oil. We’re still addicted, we can’t help it. Our entire economy practically runs on the thick, oozy substance. Where would we be without it? “Practical” living dictates that we require oil so we can hold on to our Suburbia-induced laziness and misplaced sense of entitlement. Sure, we hear talk about alternative fuel sources, clean coal, the ever daunting and scary idea of “Nuclear Energy”, which when uttered conjures up imagery of disasters and the iconic mushroom cloud. However, when alternative fuels are considered, at the forefront of our minds is Ethanol. The “renewable” biofuel (note that anything with “bio-” in front of it immediately sounds like winner, and with the addition of “renewable”, this is a surefire hit in the media and our consciousness) is derived from different crops, including sugar cane and corn, and from alcohol (the same that High School juniors binge on every Saturday night at their “buddy’s house”). Goodness, then whatever are we worried about the price of oil for? Ethanol is surely the way to go! Renewable, “bio-“, cleaner burning…Who sees the downside?
VeraSun Energy does. The United States second largest ethanol producer recently “idled” three distilleries, citing falling demand and cost issues over covering production. Fluctuating corn prices make it hard for ethanol producers to make profits, often at best they only thing they can manage is to break even. Corn prices rose 58 percent from January to July in 2008, then dropped 13 percent below year ago levels just the other day. Corn prices are flip-flopping more then oil prices are, and VeraSun has felt it. In October they filed for bankruptcy protection, blaming corn prices. Investors aren’t looking ahead to a brighter future either. Bill Gates sold his stake in the company Pacific Ethanol after the company showed a 92 percent decline last year. Biofuel Energy Corp. has lost 96 percent since 2007. A few years ago, everyone was jumping on the ethanol bandwagon. It was the hip, cool thing to do. “Flex Fuel” cars started to fly off the lots. Why not invest? The problem however is that those who tried to capitalize on the rush went into debt. The problem they now face? To much supply, not enough demand. Familiar sounding.
In fact, as everyone was all smiles about ethanol and a greener, cleaner future, Albuquerque Police went ahead and jumped on too. In 2005, the mayor happily showed off his E-85 fueled truck. The police started using a couple hundred E-85 fueled cars as well. But now, they’re abandoning those vehicles. Why? Cost and fuel efficiency, which can be 25% lower then unleaded gasoline. The cars are also prone to breaking down, so in order to save money both on fuel and for repairs, the police have decided to forsake the E-85 fuel for conventional unleaded gasoline.
(There should be mention here that studies have shown that ethanol E-85 has sever health risks and increased air pollution.)
Did we mention that while the United States deals with our wonderful fuel crisis’s, Brazil’s ethanol is doing just fine? Better then fine, perhaps. Sugarcane ethanol has shown a better yield, and a better energy balance then America’s corn ethanol. Their productivity is double that of the US’s (27 to 870 gal/acre compared to 321 to 424 gal/acre), thrice the green house gas reduction (86%-90% compared to 10%-30%), and a better estimated “payback” for green house gas emissions (17 years compared to 93 years). Not saying that it’s been an easy road for the past 30 years, but they’re on the right path, if we consider ethanol to be the right path.
Here’s another problem. A bigger problem, perhaps. Biofuels are driving up the cost of food. Filling up on ethanol takes away from food supplies that could help feed countless people. Here’s a question we should ask ourselves, what’s more important? Feeding our need to feel green and hold on to our SUV’s and Suburban homes, or feeding the countless starving people. You know, the ones we see on the television as we kick back and watch our favorite TV shows. The ones who look so distraught, so starving that any point they could curl up and die. The ones who look to us to help them. The ones who, when we see them on that commercial, we think to ourselves, “Damn, maybe I should do something about that. Even just donate a little bit of money” but never do. I’m not just talking Africa and every Third World Country, but even in our own backyard. Remember those? The ones we pass on the street, and maybe–if we’re feeling generous enough–we throw whatever loose change we have in our pocket, even though we know they’ll just buy some alcohol with it.
If by now my standpoint isn’t clear, then read that again. Being green is one thing, but disillusioning ourselves into a false sense of “Green-ism” and then millions and billions of dollars later realize that we’re just stupid, is something totally different. And maybe just a little bit unacceptable. In my mind at least.
But I’m also partially bigoted. Let’s not forget that. You should be too.