On the subject of ethanol, it seems that every time I turn on the radio someone is blaming something on ethanol. If it’s not high food prices or starving people in 3rd world countries (that couldn’t afford US food prices even back when we were paying farmers to not farm) or green house gasses, or drunk driving, it seems that distillation is always the root cause. I’d go on about it at length on the Mass blog but I’d rather not deviate too much from physics and math. So I registered a fuel ethanol blog with WordPress but I haven’t posted anything. Too lazy.

Ethanol from corn is quite profitable so long as you control your expenses. The companies losing money on it have combinations of top heavy management expenses (i.e. they’re really companies designed to sell stock rather than ethanol), along with poor site selection (and so have higher expenses in shipping ethanol, or corn, or both, or high prices for one thing or another), and high debt service (which usually comes from their being low tech industrial plants built by high dollar construction firms, along with markup to the eventual buyer). If you control those costs, ethanol is quite profitable (close to $1.00 per gallon) in the US (at corn prices of $5.50 per bushel and ethanol at $2.5 per gallon) even without any government subsidies. But to go through these things takes more time than I’m willing to spend, at least so far.

please don’t mistake my intention – I am very very happy to see any and all efforts to reduce our use of fossil fuels. In fact, I think the president’s measure is too modest, and that investment by the federal government in research into renewable, non-polluting energy sources should be greatly expanded. My cynical side says that the president’s measure is all about P.R. and the fact that it appears so prominently on the DOE web site seems to underline its utility as P.R. This information certainly belongs on the DOE web site – but then so does the information about the cuts to basic scientific research.

I think your blog is really great, but I have not read all of it. I’ll see whether I can find information about that ethanol plan, and read it.

thanks,
Michael

An example (outside of our company) of the drift from high tech to renewable fuels is Robert Zubrin. His previous books were on rocket stuff (i.e. how to put mankind on Mars). His latest book (which I highly recommend) is “Energy Victory” and is about renewable fuels as a way to fight OPEC.