The nation’s leading food processor is making big profits from ethanol. Archer Daniels Midland has had two straight years of record profits. And in its latest quarter, the company nearly set another record. Dustin Dwyer has more:
Transcript
The nation’s leading food processor is making big profits from ethanol. Archer Daniels Midland has had two straight years of record profits. And in its latest quarter, the company nearly set another record. Dustin Dwyer has more:
ADM’s profits on corn processing, which includes ethanol production, more than doubled in its latest quarter. Total profits for the period were about $400 million.
Daniel Kammen studies energy policy at the University of California – Berkeley. He says while ADM is making lots of money from corn-based ethanol, future profits could go to companies that make ethanol from switchgrass and other woody products.
“It’s really the first companies that switch into cellulosic sources that I think are going to be the big winners, because they’re going to capture the environmental prize as well as the offsetting gasoline prize.”
ADM executives have laid out a new strategy that includes plans to expand ethanol production from fuel sources other than corn.
Daniel Kammen notes that there might not even be a market for ethanol if not for government subsidies, which also helped ADM reap its bigger profits.
Switchgrass is an easily grown biofuel crop, which can be used to make ethanol. (Photo courtesy of the National Renewable Energy Laboratory)
This summer, drivers got a crash course in the dangers of fossil fuel. Gas prices shot above three dollars a gallon, concerns about global warming surged, and instability continued to plague areas of the world where oil is produced. We’ll be taking a look at some of the technologies that could help the US kick its fossil fuel habit. We’re starting with an alternative fuel that’s been sprouting up in gas stations across the region. Dustin Dwyer has this look at the promise, and the limitations of ethanol:
Transcript
This summer, drivers got a crash course in the dangers of fossil fuel. Gas prices shot above $3 a gallon, concerns about global warming surged, and instability continued to plague areas of the world where oil is produced. We’ll be taking a look at some of the technologies that could help the US kick its fossil fuel habit. We’re starting with an alternative fuel that’s been sprouting up in gas stations across the region. Dustin Dwyer has this look at the promise, and the limitations of ethanol:
This summer, Misty Childs found a way to do something positive about the fossil fuel problem. She says that she and her husband realized their Chevy Silverado pickup could run on E-85, a blend of 85 percent corn-based ethanol and 15 percent gasoline.
E85 burns cleaner than gas alone, so it’s good for the environment. And the ethanol is made from corn grown in the US. As she tops off her tank at a gas station, Childs says that makes a difference.
“It means a lot that we’re doing something for our country here, and not having to rely on others.”
Detroit’s Big Three automakers have been making a big push for E-85 in the last year. E-85-capable vehicles get the automakers a credit on federal fuel economy standards. So, even if drivers put regular gas in the vehicles instead of E-85, Detroit still gets a credit for doing better. And this summer, as more buyers became aware of the problem with fossil fuels, E-85 was just about the only alternative Detroit had to offer.
But ethanol as it’s currently made has limits. Jason Hill is a researcher at the University of Minnesota. He recently published a study on the long term outlook for corn-based ethanol.
“What we found is if you convert every corn kernel we produce in this nation to ethanol, we would be able to offset only about 12 percent of our national gasoline usage. So that’s not that large.”
That’s every corn kernel, including what we currently use for food. Which brings up another problem with ethanol: if E85 jumps in popularity, will that mean less corn for animal feed and grocery stores?
Maybe. Corn originally became popular because it was already being grown around much of the country, with help from federal subsidies. And ethanol processors, such as Archer Daniels Midland, also got tax breaks for making corn-based fuel.
But there’s another option for ethanol. Inside a lab at Michigan State University, researchers are working on the next generation of the fuel. This is what’s called cellulosic ethanol. Instead of using grains like corn kernels, cellulosic ethanol is made from the starches in plant cell walls. It can be made from pretty much anything that stands up straight – wood, prairie grasses and corn stalks.
That offers the possibility to increase the ethanol output for every acre of land devoted to the crops, and those crops don’t require fossil fuel-based fertilizer. They also don’t require planting every year by gas or diesel burning tractors the way corn does.
Professor Bruce Dale heads research into cellulosic ethanol at MSU. He says the current problem with cellulosic ethanol is finding a cheap way to break down the stiff materials. His lab uses ammonia to do the trick.
“The idea is to make cheap sugar. And the plant cell walls potentially could give you the cheapest sugar on the planet, if we could figure out how to get at that sugar easily. That’s what our ammonia process does in combination with the enzymes.”
It turns out that, much like a teenager eating pop-rocks, cars and trucks get a whole lot of energy from fuels based on sugar. Dale says most woody plants have plenty of sugar, but it’s really hard to get that sugar out.
Dale says some cellulosic ethanol could be on the market in the next few years, and the fuel could eventually sell for about 60 cents a gallon.
Right now, ethanol is still hard to find at the pumps. And one study says, even with major investment over the next decade, cellulosic ethanol might only equal half of our current oil useage by 2050.
That’s still a lot. But to really eliminate the need for gas, many experts say it’ll take more than just one technology.
As of this month (Oct.), there are six billion people on the planet and
the population will keep rising. It’s predicted the population will hit
eight-and-half billion by the year 2025. But some experts say the demand
for food will rise even faster. The Great Lakes Radio Consortium’s
Lester Graham reports… feeding the world will be one of the biggest
challenges of the coming century:
