Foreign Affairs: How Biofuels Could Starve the Poor

The May/June issue of Foreign Affairs has an article called How Biofuels Could Starve the Poor, by C. Ford Runge, Director of the Center for International Food and Agricultural Policy at the University of Minnesota, and Benjamin Senauer, Co-director of the Food Industry Center at the University of Minnesota.

The title of the article is a bit histrionic, and the cover blurb on Foreign Affairs, “Ethanol’s Real Costs,” seems ominous. Both undercut the balanced and well-supported argument of the article, which is simply that the biofuels supported by vast, long-lasting subsidies in this country -- ethanol from corn and, to a somewhat lesser extent, biodiesel from soybeans -- are not panaceas. They’re more like red herring in the broader search for alternative fuels and energy sources. If the United States and other countries were to carry out the farming, processing, and selling of these particular biofuels to the extent that the current hoopla surrounding them suggests we should, bad things would happen.

“Filling the 25-gallon tank of an SUV with pure ethanol,” say the authors, “requires over 450 pounds of corn -- which contains enough calories to feed one person for a year. By putting pressure on global supplies of edible crops, the surge in ethanol production will translate into higher prices for both processed and staple foods around the world. Biofuels have tied oil and food prices together in ways that could profoundly upset the relationships between food producers, consumers, and nations in the years ahead, with potentially devastating implications for both global poverty and food security.”

That’s the thesis, and it’s no doubt true. As the demand for both petroleum and biofuels rises in coming years, spurred largely by economic growth in China and India, the economic ripple-effect will be profound, and this is almost inevitable whether the price of oil rises or falls. Never mind the biofuel mania or bubble in which speculators drive prices up and down in ways that have little to do with real supply and demand: “Whatever happens in the oil market, the drive for energy independence, which has been the basic justification for huge investments in and subsidies for ethanol production, has already made the industry dependent on high oil prices.”

The authors cite the oft-quoted statistic that the entire U.S.corn crop, if used to make ethanol, would only replace about 12 percent of current U.S. gasoline use. “Thinking of ethanol as a green alternative to fossil fuels reinforces the chimera of energy independence and of decoupling the interests of the United States from an increasingly troubled Middle East.”

That sentence is disappointing, because it makes no distinction between total independence, which may in fact be a chimera, and practical independence, or independence from sources that can exert harmful leverage. Practical independence may be difficult, yes, but fanciful and deluded, no. The U.S. burns about 21 million barrels of oil per day. Of that total, about half is imported. Of those imports, about half come from OPEC. Get rid of the OPEC piece and we get rid of the truly unhealthy part of our addiction –- a quarter of our total demand and half our imports. We need to do that immediately. If there were political courage and a public sense of urgency (which can only be instilled from the top down) we could do it in a few years. With less courage and less urgency it might take a decade. From there it would still be a push to full practical independence, but the difference would be only a few million barrels a day, and at that point maybe we could relax a bit. Our biggest supplier now is Canada, selling us over 2 million barrels per day. That’s not the same dependence, by a long shot, as being oil junkies at the mercy of the Saudi candy men.

In any case, professors Runge and Senauer wrap up their article with a dose of good sense, reiterating the absolute fact that conservation trumps all other methods and technologies for “going green” and saving the nation in both the geopolitical and environmental realms: “Limiting U.S. dependence on fossil fuels requires a comprehensive energy-conservation program. Rather than promoting more mandates, tax breaks, and subsidies for biofuels, the U.S.government should make a major commitment to substantially increasing energy efficiency in vehicles, homes, and factories; promoting alternative sources of energy, such as solar and wind power; and investing in research to improve agricultural productivity and raise the efficiency of fuels derived from cellulose. Washington’s fixation on corn-based ethanol has distorted the national agenda and diverted its attention from developing broad and balanced strategy.”

Runge and Senauer are positive about the U.S. DOE investment in cellulosic ethanol refineries, and it would be interesting to hear their take on some of the newer experimental biofuel technologies like the one being developed by Greenfuel Technologies -- fast-growing, carbon dioxide-eating algae that can be broken down into either ethanol or biodiesel.

~ Doug Logan, New Energy Watch