1. The Failure of Bio-Fuel Alternatives, The Abundance of Cheap Fossil Fuels, & Bio-Fuel Harm to Food Supply & Price What is to be Done?

2. Thomas W. O’Donnell The New School University, NYC Graduate International Affairs -&- Universidad Central de Venezuela, CENDES, Caracas Ohio State University, Columbus, OH – S2011 AID, New School Panel, 25 March 2011: Food Crisis & Impact on Developing Countries

3. Outline 1.The Failure of Bio-Fuel Alternatives 2.The Abundance of Cheap Fossil Fuels 3.Bio-Fuel Harm to Food Supply & Price 4.What is to be Done?

4. History and projections IEA of OECD

5. Demand EIA of U.S. DoE http://www.eia.doe.gov/neic/speeches/howard070106.pdf

6. Transport problems http://www.eia.doe.gov/neic/speeches/howard070106.pdf Cifras de 2006

7. Transport problems http://www.eia.doe.gov/neic/speeches/howard070106.pdf Cifras de 2006 Transport emissions due to petroleum!

8. Problematic renewable hydrocarbon “alternative" http://www.iea.org/textbase/country/graphs/weo_2006/gr12.jpg

9. "Alternativa" de hidrocarburos renovables 1. El etanol – Balance de energía – No celulósicas de maíz – celulósicas de maíz y no consumibles – La caña de azúcar, ejemplo Brasil – Monto de la tierra, elección de la tierra, los precios de los alimentos (geo- estrategia más tarde) – Costo, las subvenciones – Mínimo impacto en la autosuficiencia (geo-estrategia más tarde) 2. Bio-diesel http://www.iea.org/textbase/country/graphs/weo_2006/gr12.jpg

10. Corn Ethanol Production... expect to use 27% of ’07 corn crop for nearly 9 bil. gal. Source: Keith Collins, Chief Economist, USDA EIA Energy Outlook, Modeling, and Data Conference March 28, 2007 27%

11. Bush “20 in 10” Proposal  Reduce U.S. gasoline use by 20% in the next 10 years  Path: – Modify CAFÉ – Require 3 billion gallons of renewable and alternative fuels by 2017  Easy to achieve?  Role of Ethanol and Biodiesel ? Source: Keith Collins, Chief Economist, USDA

12. Change in Fuel Use Since 2005 Met by Ethanol/Biodiesel Source: 2007 EIA Annual Energy Outlook ∆ Total Gas/Distillate Use ∆ E/B use E/B share of ∆ total fuel use Source: Keith Collins, Chief Economist, USDA

13. Projected Corn Ethanol Production… The. Source: USDA, 2009 See notes herein Energy Independence and Security Act of 2007 ("EISA") Renewable Fuel Standard ("RFS") increases bio-fuel production Funding encourages production of cellulosic and advanced biofuels. EISA signed Dec 07, took effect Jan 09. Under the EISA, the RFS will be expanded from the original mandate of – 7.5 billion gallons by 2012 to – 36 billion gallons by 2022 – Minimum portions of the mandate must be satisfied by advanced biofuel, cellulosic biofuel and biodiesel.

14. Projected Corn Ethanol Production… The. Source: USDA, 2009 See notes herein

15. USDA Baseline Biofuel Production “20 in 10” 22 billion deficit Source: Keith Collins, Chief Economist, USDA

17. Chief Economist USDA -- ethanol efficiency improvements 2010 report (2005 & 2008 data)

20. Corn Ethanol Production... expect to use 27% of ’07 corn crop for nearly 9 bil. gal. Comment (TO’D): 9 b gal is 10 days U.S. consumption, but 27% corn acres Source: Keith Collins, Chief Economist, USDA EIA Energy Outlook, Modeling, and Data Conference March 28, 2007

22. Food and Oil Commodity Prices Corn Rice Wheat Oil 1980 1986 1991 1996 2003 2011

23. T. O’Donnell, Ph.D. | twod@umich.edu | TomOD.com 23 Oil Consumption per capita EIA 2003 Gallons per day per capita

24. T. O’Donnell, Ph.D. | twod@umich.edu | TomOD.com 24  Ethanol Oil Consumption per capita Gallons per day per capita

25. The Failure of Bio-Fuel Alternatives What sort of “energy independence” can cellulosic corn-based ethanol bring to the U.S.? To replace U.S. gas production with ethanol made from corn – the dominant and government-subsidized mode of producing ethanol in the U.S. Consider: Use claims from articles in NATURE: Note, the oil consumption of the U.S. is about 21 million barrels per day (21 mbbl/d). Hence, two Iowas, totally dedicated to producing corn for ethanol, AND, using not today’s methods of corn-to-ethanol production, but the as-yet not fully developed cellulosic methods, whereby nearly the entire corn plant, not merely the starches and sugars of the corn kernels, was turned to into ethanol, would replace, approximately: 1/21 * 100 ~ 5% of U.S. oil demand. Not what one would call “energy independence;” nor would it bode well for the price of corn flakes or Mexican tortillas, etc.

26. Oil Theories Source: US DoE Hubbert’s ½-depletion peak

27. Reserves “An oil transition is not a shift from abundance to scarcity: fossil fuel resources abound. Rather, the oil transition is shift from high quality resources to lower quality resources that have increased risks of environmental damage, as well other risks”. Environ. Res. Lett. 1 (2006) A E Farrell and A R Brandt ReservasIncreasingly uncertain resources Potential for liquid hydrocarbon production (Gbbl) To be consumed Already consumed

28. Reserves “An oil transition is not a shift from abundance to scarcity: fossil fuel resources abound. Rather, the oil transition is shift from high quality resources to lower quality resources that have increased risks of environmental damage, as well other risks”. Environ. Res. Lett. 1 (2006) A E Farrell and A R Brandt ReservasIncreasingly uncertain resources Potential for liquid hydrocarbon production (Gbbl) To be consumed Already consumed

29. “Long Term World Oil Supply: A Resource Base / Production Path Analysis” Energy Information Administration (EIA), DOE, 2000). http://www.umich.edu/~twod/oil- ns/articles/longterm_usgs_oil_peak_estim_eia2006.pdf http://www.umich.edu/~twod/oil- ns/articles/longterm_usgs_oil_peak_estim_eia2006.pdf The authors’ note: “EIA presentation on estimates of the world conventional oil resource base and the year when production from it will peak and then begin to decline. A version of this presentation was given by former EIA Administrator Jay Hakes to the April 18, 2000 meeting of the American Association of Petroleum Geologists (AAPG) in New Orleans, Louisiana.” “U.S. Geological Survey World Petroleum Assessment 2000 – Description and Results” “Chapter ES” (i.e., “Executive Summary”): http://energy.cr.usgs.gov/WEcont/chaps/ES.pdfhttp://energy.cr.usgs.gov/WEcont/chaps/ES.pdf The USGS 2000 report referred to, and used in, the above EIA report: http://pubs.usgs.gov/dds/dds-060/ and often referred to very negatively by adherents of the Peak Oil school.http://pubs.usgs.gov/dds/dds-060/ References

30. The problem of transportation Efficiency =  1 x  2 x  3 x  4 x … Mass transport vans, busses, trains, metros Batteries Petroleum Coal Natural Gas WaterNuclear Bio- combustibles Refinery LiquefyHydroelectricThermoelectric Solar y wind Individual: Automobiles, motorcycles, light trucks Internal combustion Hydrogen cell Mass transport: Vans, busses, trains, metros Hydrogen Ethanol & Diesel 3-4 3 2 Transmission 3 Electric motors Electric motor 95% Friction

31. There are no “alternative fuels” able to transform today’s transport system in accord with: - Environment - Agriculture - Information revolution economy - Congestion & sprawl - Social justice What To Do? - Transform transportation itself not its fuel This need not be a ‘utopian’ program

32. References

33. 5. Conclusions

34. Projected Corn Ethanol Production… expect 12 bil. gal. in 2016/17– 30% of corn crop Source: Keith Collins, Chief Economist, USDA

35. Projected Soy Biodiesel Production… expect 700 mil. gal. in 2016/17 – 23% of soyoil production Nota Source: Keith Collins, Chief Economist, USDA