American Made Energy – Oil, Ethanol and the BIG Energy Picture

The introduction of the American Made Energy Act (HR 5890) by Representative Nunes in July gives an insight into the big picture of the future of energy production in this country. The bill’s highlight is the creation of an energy trust fund from the proceeds of lease sales and the production royalties from future 10-02 ANWR oil development. From this trust fund a vast and generous array of programs is created benefiting alternative fuels, primarily cellulosic ethanol, production.

Making cellulosic ethanol is an emerging technology that uses plant matter such as corn stalks, wheat grass, perennial grasses and wood chips, as a “feedstock” in specialized refineries to produce ethanol. Although the end product is the same it is slightly more complex than producing ethanol from straight corn grain, which is how 90% of America’s current ethanol is produced. At the gas pump ethanol comes in the form of a blended fuel called E10 or E85 which is either 10% or 85% ethanol and the rest regular gasoline. Production of corn based ethanol is currently much cheaper by half than the emerging cellulosic production. The cellulosic technology is reliant on a more complex refining process using specialized enzymes, the development of which is still being researched. The advantage of cellulosic ethanol though comes from its vast array of potential feedstocks, some of which, for example, switchgrass, have a very low impact on the environment. The establishment of American Made Energy (ANWR powered) Trust Fund in Representative Nunes’ bill is hoped to give the cellulosic ethanol product a much needed push to make it a viable energy option along with corn based ethanol.

Within the many sections and details of HR 5890 one can easily overlook the big picture that this bill is trying to address. That is that ANWR and Alaskan oil is inextricably linked and an integral part of the greater picture of our nation’s future energy supply. Potential resources from ANWR are not the ‘be all and end all’ solution to our energy needs, as many environmental groups portray ANWR supporters as believing, but rather a linked piece of the energy puzzle that has massive benefit to the nation. This benefit is not just as an energy source, but also as a tie and provider of opportunity for us to explore and develop other energy resources. HR5890 exhibits this fact in spades with development potential for coal-to-liquid hydrocarbons, solar and cellulosic ethanol energy. As the Department of Agriculture readily admits, only about 30% of our current oil consumption needs could possibly be replaced by future ethanol production. ANWR supporters similarly argue that ANWR oil can never be the sole source of energy to America supplying X number of days of oil (as many environmental groups claim), but rather a partial source of energy lasting 30 plus years as we research and develop future renewable energy sources. The saying that “we will always need oil” for our paints and plastics, and roads and tires does not ignore the fact that oil is finite. However being responsible and using oil derived resources to enable us to work toward transitioning to a more sustainable energy source as HR 5890 does, provides a much more sensible and realistic policy than draconian environmentalist views of banning oil production all together.

The diversification of our energy sources is paramount and HR 5890 shows just how much of a prime mover ANWR can be. ANWR development can be viewed not only as a direct and much needed source of energy but as a source of “free” revenue the government can use (other than taxing the public) to help grow alternative energy sources. No other energy source we use provides this sort of income opportunity to the government and development opportunity to the nation.

Indeed the cellulosic ethanol pioneers have a long ways to go to develop the infrastructure, distribution and manufacturing processes that the petroleum industry has done over the last 90 years, but using ANWR revenue to do so will allow this to take place. Passage of the Representative Nunes’ bill this September will be one great step for a better energy future for America.

Some ethanol facts to know:

America is the world’s largest producer of ethanol @ 4,336,000 gallons per year. Brazil is a close second followed by a distant China. America’s production is mostly based on corn as a feedstock while Brazil’s production is based on sugar cane.

15 % of the corn produced in America is used for ethanol production.

Iowa produces the most ethanol in America at 29% (1,243,000 gallons) followed by Illinois 17% (724,000 gallons) Nebraska 13% (549,000 gallons), Minnesota 11% (496,000 gallons) and South Dakota 10% (455,000 gallons).

Cellulosic ethanol uses enzymes to break down two plant sugars: cellulose and hemi-cellulose. Breaking down hemi-cellulose is difficult and the development of more efficient enzymes to do this will prove the success of the cellulosic industry. Other problems such as transport of ethanol, which is high corrosive, as well as the harvesting and storage of feedstock for refineries are some of the problems the ANWR powered trust fund money will hope to solve.

E10, or 10% ethanol fuel, accounts for 99% of all ethanol use in America.
E10 produces a roughly 2% reduction in mileage and E85 produces roughly 10 to 20% reduction over regular gasoline in the Flex Fuel Vehicles (FFV) used today. However one should note FFVs are calibrated for gasoline use, not E-85. Sensor technology will shortly be commercially available to adapt to varying amounts of ethanol and provide comparable mileage across the ethanol/gas mix spectrum.

The corn industry producing normal ethanol will also be a part of the cellulosic ethanol production with the incorporation of potential use of corn stalks and husks known as stover.

American ethanol production will increase by 1,946,000 gallons to 6,282,000 gallons per year from plants currently under construction. Despite this ethanol makes up only just over 2% of the nation’s annual vehicle fuel supply.

The Renewable Fuels Standard passed by Congress will require doubling our use of ethanol by 2012.

In the last few years use of genetically modified corn has allowed the production of corn to greatly increase while the land footprint has remained relatively stable. Other feedstock crop production also benefits from genetic modification.

For more information on ethanol please view the following web links:


http://www.nationalaglawcenter.org/assets/crs/RL33290.pdf#search=%22Fuel%20Ethanol%3A%20Background%20Public%20Policy%20Issues%2C%20Congressional%20Research%20Service%20Reports%22

http://desmoinesregister.com/apps/pbcs.dll/article?AID=/20060827/OPINION03/608250397/1035/OPINION

http://www.ethanolrfa.org/


http://www.ncga.com/