Gov. Dave Heineman was in town the other day extolling the virtues of renewable fuels, namely ethanol and wind energy. He makes it all sound so good, but it is time to be more realistic about these energy sources.
The governor said, “Who would have known the ethanol industry would be where it is today.” Actually, the industry is where it is today only because of generous taxpayer subsidies and mandated blending requirements. Otherwise, the industry would have collapsed years ago, and will still collapse once artificial supports are withdrawn.
We have known as early as 10 to 12 years ago, based on reliable studies, that it would not be cost effective to produce ethanol from corn. This is pretty well borne out by the fact that every time subsidies and blending mandates are threatened the ethanol interests jump up and down and squeal. But who cared; it created jobs and made money for initial investors.
As ethanol production unfolded under the guise of “economic activity,” it has rolled on with the support of politicians and news media, particularly in states with dominate agricultural economies. This is unfortunate because diversion of corn to ethanol production has caused serious harm to the country including: waste of water resources, sharply increased grocery prices, questionable land use practices, and squandering of public funds better used elsewhere.
Furthermore, use of grain for fuel cannot be a long-term solution, because even given advances in agriculture and the best corn growers in the world we will eventually need to allocate grain solely for human food production.
While in town, Gov. Heineman also put in a plug for wind energy, and he talked about all the jobs it would create. In other words, is this just more “economic activity” or is wind energy really a viable long-term energy solution? I ask myself this question every time I see that silly spectacle of huge propeller blades being hauled down the highway with much fan-fare, led and followed by signal vehicles.
Is it likely that given issues such as: wind unreliability, site development expense, equipment cost, maintenance expense, and energy transmission problems, wind energy, as with ethanol, also will not be cost effective? Probably. In any event we must evaluate this energy source very carefully because, in the meantime, we can be sure of another round of developers who will be asking for tax breaks, subsidies and any other handouts available, once again, compliments of the taxpayers.
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