Robert Inman, Past Chairman of the Board for the Association of the Illinois Electric Cooperatives
Finger Pointing Won’t Solve Our Problems
Biofuels aren't the primary cause of higher food prices
There’s no question that the price of a gallon of milk and gas have gone up dramatically. Some blame rising food prices on the increase in renewable energy such as ethanol. But there isn’t an easy answer to our energy issues, or one thing we can blame for higher food prices.
There are many reasons for the increase in food prices. And although increased production of ethanol is a factor, it’s a very small one. Political strife, drought, floods and global population and demand increases are more important issues driving higher food prices.
Food prices have risen 244 percent since 2004. A new report from New Energy Finance concludes that biofuels are responsible for at most 8 percent out of the 168 percent rise in grain prices since 2004. And grain prices are only a portion of the overall cost of our food.
In June, the Secretary of Energy Samuel Bodman and the Secretary of Agriculture Edward T. Schafer stated that food prices were being driven up by higher oil prices, increased demand for developing nations, two years of bad weather and drought in parts of the world and export restrictions in some countries. Bodman and Schafer also said without biofuels, gas prices would increase $.20 to $.35 a gallon. This saves the typical household $250 to $300 a year and saves the U.S. overall as much as $49 billion. The Department of Energy’s (DOE) scientists found that corn-based ethanol reduced greenhouse gas emissions 19 percent compared with gasoline. And we should remember that the original reason for adding ethanol to our gasoline was to improve air quality.
Our transportation infrastructure, distribution system and the cost of energy have a lot to do with the price of food and just about everything else. We can improve our distribution system and cut the cost to our economy. For example, we should improve our river navigation system, rail system and highways. River barge transportation is the most energy efficient. One ton of freight on a barge can travel 522 miles on a gallon of fuel. That compares to 386 miles on rail and 59 miles by semi-trailer truck. Yet we are putting more and more of our transportation burden on trucking and failing to improve our rail and river navigation systems.
We can also make improvements to the biofuels energy system. There’s no question that the biofuels industry is still in its infancy in many ways. In the past year we’ve seen plans for new ethanol plants come and go, while others have made it through some tough times to completion. We need to find new answers to our energy demand. Biofuels will need to be a part of the solution. We need to continue to support this effort with a heavy dose of research and development that will continue to improve on our biofuels options.
American farmers have a long history of producing more with less. Ethanol and biodiesel production will continue to be improved as well. The big change will come when we can switch from corn to switchgrass for ethanol production. Right now there’s a lot of research and development going on across the country to help make that happen. For example, the DOE is investing about $385 million in six projects over the next four years to develop switchgrass ethanol production.
Switchgrass was here when the settlers crossed the Great Plains and can be grown in 40 states. It grows to more than 8 feet tall, can produce 6 to 7 tons per acre, and needs very little fertilizer. It’s estimated that switchgrass is capable of producing five times more net energy than corn-based ethanol.
Even big oil companies are entering the biofuels business. ConocoPhillips recently announced a technical cooperation agreement with Petrobras of Brazil, a leading sugarcane ethanol producer. ConocoPhillips also opened a new 432-acre research and training campus in Colorado and signed a $5 million research deal with the Colorado Center for Biorefining and Biofuels.
Biofuels represent just one of the logical options that will help us transition from an oil-based transportation system to one that will most likely be powered by electricity. Let’s all continue to look for answers and remember that pointing fingers never solves problems.
Robert Inman is the Past Chairman of the Board for the Association of the Illinois Electric Cooperatives, a Board Member for Southern Illinois Electric Cooperative and an active agriculture leader from Grand Chain.
The opinions and views of guest commentators are their own and may not represent those of the Association of Illinois Electric Cooperatives or the electric co-ops of Illinois.
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