In 2009, one-third of U.S. corn was converted to ethanol. According to Dr. David Pimentel of Cornell, this replaced a whopping 1.4 percent of our oil consumption. This means that only 4.2% of our oil consumption would be replaced if we turned all American corn into ethanol! Even converting all corn and soybean production to biofuels would meet only 12% of gasoline (only) demand and 6% of diesel demand.
In January 2010 the EPA granted a waiver to existing rules to allow the use of E15 — made with 15 percent ethanol and 85 percent gasoline — in cars made in model year 2001 or after. The decision expands the pool of vehicles that could use such a fuel to about 62 percent of the total on the roads. Agriculture companies and ethanol distilleries have been pressing for an increase in the limit on ethanol in motor fuel because ethanol production in the U.S. is approaching 10 percent of gasoline use, a point commonly known as the “blend wall” in the ethanol industry.
“That decision (to allow E15 use) was pure politics,” Iowa State economist Swenson tells me.
“A dumb move,” Dr. Pimentel added.
University of Minnesota bioengineer Dr. Jason Hill called the increase dangerous, adding that “it wasn’t studied that well.”
Until recent increases in oil prices, high production costs made biofuels unprofitable without subsidies. According to Swenson, accelerated investment in ethanol plants has been due to skyrocketing corn prices as well as the increases in subsidies and RFS requirements.