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Adding ethanol to gasoline makes it cleaner and reduces air pollution, right? So biofuel lobbyists would have us believe. However, a study published in Proceedings of the National Academy of Sciences (PNAS) comes to the opposite conclusion.

Lead author Jason Hill of the University of Minnesota Department of Bioproducts and Biosystem Engineering summarized key findings of the study at a recent House Science Committee hearing. To determine which is cleaner, gasoline or ethanol, researchers must “compare these fuels over their full life cycle.” Hill explains:

That is, we need to consider the damage caused by producing them in addition to using them. For gasoline, the life cycle includes extracting and refining crude oil, and distributing and combusting the gasoline itself. The life cycle of corn ethanol includes growing and fermenting grain, and distilling, distributing, and combusting the ethanol itself.

Although combustion emissions from ethanol are lower than those of gasoline, production emissions from ethanol are higher. So much so that on a life-cycle basis, ethanol is the larger source of five different air pollutants: primary fine particulate matter (PM2.5), nitrogen oxides (NOx), amonia (NH3), volatile organic compounds (VOCs), and sulfur oxides (SOx).

Those results are an additional reason EPA should resist pressure from biofuel lobbyists to increase Renewable Fuel Standard (RFS2) blending targets for 2014-2016. As Hill cautions: [click to continue…]

As the June 1 deadline approaches for EPA to propose Renewable Fuel Standard (RFS) mandates for 2014, 2015, and 2016, biofuel lobbyists are cranking up their political and PR efforts to sway EPA’s decision. In a television and digital ad campaign launched this week, Fuels America, a coalition of biofuel interests, accuses the “oil industry” of “refusing to fulfill its obligations” under the RFS.

Fuels America also claims EPA must choose either to support “rural economies,” “permanent jobs,” and “the world’s cleanest motor fuels,” or to “reward” the oil industry, which supposedly means “more imported oil from hostile foreign regions, more pollution and spills,” “fewer American jobs,” “protecting the oil monopoly on our fuel supply,” and “even higher gas prices.”

Fools America is a much better description of what these regulatory profiteers are trying to pull off. The RFS does not benefit “rural economies,” it benefits corn farmers at the expense of beef, poultry, and hog farmers. The RFS creates “permanent” jobs only in the sense that it creates special privileges in the form of government-guaranteed market shares for biofuel companies and the corn farmers who supply them. A “monopoly” is a market with a single supplier; a commodity such as a fuel type cannot be a monopoly. Gas prices and oil imports from hostile regions are at their lowest levels in a decade, thanks chiefly to the fracking revolution and U.S. oil companies, not RFS blending requirements.

As for the RFS producing the world’s “cleanest” fuels, the program has significant environmental downsides. It expands aquatic dead zones, accelerates wetlands conversion and habitat loss, may increase smog-forming VOC emissions, and likely increases net greenhouse gas emissions. The RFS program also inflates food and fuel costs and exacerbates world hunger, contributing to political instability and violence in developing countries.

Let’s delve a bit deeper into the controversy over the 2014-2016 ethanol mandates and Fools America’s campaign to influence EPA’s rulemaking.

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It’s common knowledge that the Renewable Fuel Standard (RFS) is a textbook study in the law of unintended consequences. The program inflates food and fuel costs, exacerbates world hunger, contributes to political instability and violence in developing countries, expands aquatic dead zones, accelerates wetlands conversion and habitat loss, likely increases net greenhouse gas emissions, and ushers in a reign of regulatory uncertainty rather than the predictable marketplace its creators intended.

And this just in: NOAA and NASA scientists find that ethanol manufacturing releases five to 30 times more volatile organic compounds (VOCs) than estimated in EPA’s 2011 National Emissions Inventory. VOCs are pollutants that form ozone-smog when they react with nitrogen oxides (NOx) in the presence of sunlight.

From a news article by Amanda Peterka in today’s E&E PM ($):

Ethanol refineries may emit more air pollution than commonly thought, according to a new study led by researchers from the National Oceanic and Atmospheric Administration.

The NOAA team, which also included scientists from NASA and academic institutions, measured the air downwind from an ethanol plant in Illinois and found emissions of total volatile organic compounds (VOC) to be five times higher than 2011 federal data.

Emissions of ethanol in the air — considered a type of VOC — were up to 30 times higher than previously thought downwind from the plant, the team said. . . .

The study has been accepted for publication in the Journal of Geophysical Research: Atmospheres. NOAA and U.S. EPA provided funding for the measurements taken by the team.

Using a small NOAA airplane outfitted with special instruments, the team measured air quality at 9, 12 and 30 kilometers downwind from the Archer Daniels Midland ethanol plant in Decatur, Ill., in June and July 2013. . . .

According to the results, measured emissions of sulfur dioxide and nitrogen oxides compared well with the EPA data. But they found that the National Emissions Inventory underestimated emissions of volatile organic compounds — gases that are a main ingredient in ground-level ozone — generated by the refining process by factors of five to 30.

EPA is more than 15-months behind its statutory deadline (Nov. 30, 2013) for establishing Renewable Fuel Standard (RFS) blending targets for last year.

To recap, in Nov. 2013, EPA for the first time proposed to scale back the government’s overall biofuel blending target for the following year. EPA determined that the statutory target for 2014 would exceed the “blend wall” — the maximum quantity of ethanol that can be sold each year given legal or practical constraints on how much can be blended into each gallon of motor fuel.

The most common blend today is E10 — motor fuel with up to 10% ethanol. Although EPA approved the sale of E15 in October 2010, potentially increasing by 50% the total amount of ethanol sold annually, lack of compatible fueling infrastructure, warranty and liability concerns, and, most importantly, consumers’ natural aversion to paying more for a lower-value product effectively limit the standard blend to E10.

So in Nov. 2013, EPA proposed to trim the statutory target for 2014 from 18.15 billion gallons to 15.21 billion gallons — a 16% cutback. That ignited a firestorm of protest from biofuel interests, and EPA has been dithering ever since.

Biofuel lobbyists such as Renewable Fuels Association CEO Bob Dinneen claim the blend wall exists only because the oil industry has “steadfastly refused” to invest in blender pumps, storage tanks, and other infrastructure compatible with E15-and-higher ethanol blends. Weirdly unexplained is why it’s not up to the biofuel industry to pay for the infrastructure on which its success supposedly depends. The RFS forces the oil industry to buy biofuel, process and add value to it, and create a guaranteed retail market for it. Isn’t that enough?

Not for Dinneen and company. If they had their druthers, Congress would compel oil companies to build biofuel-compatible infrastructure and (as President Obama proposed during his first presidential campaign) mandate that all new cars be flex-fuel vehicles capable of running on blends up to E85 (motor fuel made with 85% ethanol).

But would even that policy wish-list eliminate the growing mismatch between market realities and the RFS production quota schedule, which requires 36 billion gallons of biofuel to be blended and sold by 2022? No.

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Greenwire (paywall protected) reports that KiOR, Inc., a biofuel company backed by billionaire Vinod Kohsla, missed a $1.8 million loan payment to the state of Mississippi, now owes more than $312 million, and filed for Chapter 11 bankruptcy protection late Sunday:

The company estimated its assets are worth between $10 million and $50 million and reported debts between $100 million and $500 million (Jeff Amy, AP/ABC News, Nov. 10).

In addition, the Pasadena, Texas-based company said its default on the Mississippi loan triggered provisions of other loans, making an additional $234 million immediately due (AP/Fuel Fix, Nov. 7). — SP

EPA once pinned its hopes on KiOR to supply 9 million of the agency’s 17 million gallon 2014 cellulosic biofuel quota. As of July, however, U.S. cellulosic production was about 50,000 gallons, or 0.3% of EPA’s target, according to Platts energy analyst Herman Wang. EPA’s target is itself less than 1% of the statutory 1.75 billion gallon cellulosic target for 2014.

More proof, if any were needed, that the point of central planning is not to accomplish its stated purposes but to amass power, rig markets, and (in democratic countries) buy votes.

On August 20, commodity analyst Dave Juday contributed a guest editorial to this blog titled “KiOR News Underscores Problems with Renewable Energy Industrial Policy.” Because the column is even more timely today, I repost it (lightly edited) below:

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An extensive investigation by the Associated Press (AP) confirms what many critics of the Renewable Fuel Standard (RFS) program have been saying for years — the ethanol mandate does more environmental harm than good.

The AP article begins with an overview of key findings:

But the ethanol era has proven far more damaging to the environment than politicians promised and much worse than the government admits today. 

As farmers rushed to find new places to plant corn, they wiped out millions of acres of conservation land, destroyed habitat and polluted water supplies, an Associated Press investigation found. 

Five million acres of land set aside for conservation – more than Yellowstone, Everglades and Yosemite National Parks combined – have vanished on Mr. Obama’s watch.

Landowners filled in wetlands. They plowed into pristine prairies, releasing carbon dioxide that had been locked in the soil.

Sprayers pumped out billions of pounds of fertilizer, some of which seeped into drinking water, contaminated rivers and worsened the huge dead zone in the Gulf of Mexico where marine life can’t survive.

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All energy comes at a cost. The environmental consequences of drilling for oil and natural gas are well documented and severe. But in the president’s push to reduce greenhouse gases and curtail global warming, his administration has allowed so-called green energy to do not-so-green things. [click to continue…]