India’s New and Renewable Energy Ministry has prepared a plan, which, if implemented as stated, will make the country one of the leading producer of solar energy globally by the year 2030. The proposal, yet to be approved, calls for $100 billion investment in solar energy over the next two decades to install 20,000 MW of solar energy.

The plan proposes that the government should give out $5 billion subsidies to the power utilities, every year for the next 20 years, which will then buy solar generated power from the solar power plants. The goal seems quite ambitious given the fact that the International Energy Agency predicts global solar energy generation to be 20,000 MW by the year 2020. The proposal comes after the announcement made by the Indian Prime Minister last year that solar energy would be the focus of the energy transformation in the country.

Solar energy gains importance from the fact that the coal fired power plants in India have been struggling to get coal supplies and there is lack of consistent gas supplies from other nations. Solar energy makes sense as it can be an alternative to connecting all the remote areas of the country to the grid.

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In general it is thought that rural America feels more closely aligned with the Republican Party’s conservative social views.  However, right now it’s the Democrats who support the ethanol and subsidy policies that help so many farmers in the middle of the country to stay afloat.

Corn growers from across the nation are heading to the polls next week, and many are still feeling confused.

John Wallbrown owns a 2,800-acre farm in Portage County, Ohio.  He said that he has heard from peers who are upset with the Republican Party, and though he still plans to cast his ballot for McCain, he told the Beacon Journal in Ohio that:  ”McCain will probably lose some votes this year.”

Historically McCain and Obama have not agreed on the issue of farm subsidies.  Subsidies offer a financial safety net for farmers across the nation, whose livelihoods are very tied to the whims of nature.  McCain has been opposed to them, while Obama has offered support.

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To start with, researchers at Iowa State University have found that, even though $1.3 billion was given to the corn ethanol farming industry in the form of subsidies in 2007, the government saved $3.45 billion on what are called loan deficiency payments as a direct result of these ethanol subsidies.

Loan deficiency payments were established in 1985 as a way to ensure farmers’ incomes remained steady even when prices for commodities such as corn were abnormally low. Since 1998 the loan deficiency payment program has cost taxpayers more than $29 billion.

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Exponential increases in food prices in recent times have created enormous challenges to governments, national and international organizations, and aid agencies everywhere in the world. The World Bank has estimated that the rising food prices could push an additional 100 million people into poverty, thereby undermining the current efforts geared towards poverty reduction.

Increasing demand, decreasing supply, and the rising oil prices, which are in turn affected by numerous other factors, have been some reasons for the rise in food prices. Demand for cereal grains has been rising not only as a result of population growth, but also because of the growing middle class population in countries like China and India. Growing incomes have resulted in more demand for cereal grains directly and also more meat and dairy, which in turn has raised the demand for more grains as feed for the livestock. Another more important reason for the rise in demand for food crops is the development of bio-fuels, which have attracted a great deal of attention in recent times.

On the supply front, according to a publication by the International Center for Trade and Sustainable Development (ICTSD), droughts in Australia and Turkey and bad weather in Ukraine and parts of North America have resulted in less agricultural production which has caused food prices to rise. A more important, but often overlooked reason for the decrease in the supply of farm commodities against rising demand is that the subsidies that the developed countries have been providing to their agriculture sector have dampened world prices of those products and made the products of developing countries uncompetitive. This has had a tremendous impact in agricultural production in developing countries. In the absence of competitiveness and any other gains to be derived from agriculture, the developing countries have had less incentive to invest in agricultural infrastructure, agricultural research and development, and the like. As a result, agriculture production in these countries continually declined disrupting supply.

Then, who should take the blame of rising food prices? If we look at the demand side, we see that the demand has been rising in one part because of rising incomes in few developing countries, and on the other, because of the development of bio-fuels by the developed countries. On the supply side, drought and bad weather conditions are not something which are under human control, but less supply resulting from less production in developing countries owing to the agricultural policies of the developed countries definitely deserves attention.

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An economic analysis released February 25th shows major gains for the U.S. job market and GDP from 2007’s ethanol industry boom (emphasis added):

The analysis, conducted by John Urbanchuk of LECG, LLC, determined that the increase in economic activity resulting from ongoing production and construction of new capacity supported the creation of 238,541 jobs in all sectors of the economy during 2007. These include more than 46,000 jobs in the U.S. manufacturing sector. The goods and services required to produce the estimated 6.5 billion gallons in 2007 added $47.6 billion to the Gross Domestic Product and raised household incomes by $12.3 billion.

While the gains themselves aren’t all that surprising, they may turn the conventional wisdom that “ethanol subsidies are bad” on its head since increased tax revenue actually paid them off:

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Renewable energy has attracted a lot of attention lately as the world looks for cleaner ways to power our world. Wind and solar stand as the most recognizable clean, green dynamos, but they still struggle to compete with traditional and entrenched power producers. True to conventional economic values, competition is everything. Yet, in the U.S.A. these technologies have survived in the dog-eat-dog industry for decades mostly without the aid of government subsidies (unlike coal and oil), and many claim that renewables could take off with just a little help from Uncle Sam. What are the obstacles? Are government subsidies the only saving grace for renewables? This post hopes to shed some light on the topic and burn through the conflicting noise that surrounds this fundamental and controversial industry.

It seems like I’m always reading articles about improvements, investments, and the promise of renewable energy. For a more practical perspective, I recently asked a successful businessman, who sometimes works with solar panels, for his opinion. Did he think that solar was going to boom in the next few years? His opinion was that the industry would need more government subsidies to really take off. Even with high oil prices, it was still simply too expensive to invest on a small scale. You might regain your initial investment in 15+ years in ideal conditions. Even in states with incentives to support renewable energy, it’s expensive. His view echoed my cousin’s frustration. Yet despite the initial cost, renewables are still an attractive option. As expensive as it may be to buy and install solar panels, it’s also very expensive ($1.8-billion and rising) to build a new coal-fired power plant with “clean coal” technologies. Hidden costs also plague coal power plants: the cost to clean up mercury emissions, the water required to operate, and in some places, the cost of carbon credits. Finally, the bottom line: how much does it cost to generate each kilowatt hour? Compare two graphs, one for coal and one for solar, and you may be surprised.

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Recent energy policies, combined with pre-existing crop subsidies, tax policies, global market conditions and trade barriers all provide economic incentives for conversion of retired and other cropland to corn production for use in ethanol production. Such conversions could lead to corn production on an additional 16 million acres…

The Dead Zone, an area in which there isn’t enough dissolved oxygen to support aquatic life, has been measured in the Gulf of Mexico since 1985. It’s caused by agricultural runoff overenriching the waters at the end of the Mississippi River - the downstream effect of millions of acres of intensely fertilized crops. Nitrogen and phosphorous, intended for corn but ending up in the river, make their way to the Gulf causing excessive phytoplankton production. In the process, all available oxygen is used up (hypoxia), and marine life has to move out or suffocate.

It turns out that the greater Mississippi-Atchafalaya River Basin (MARB) drains a grand total of 40% of the contiguous United States. The cumulative effect of all this runnoff creates a Dead Zone approximatly 20,500 sq. km. - roughly the size of the state of New Jersey.

To address this issue, the Science Advisory board recommends a 45% reduction in nitrogen and phosphorous fluxes from farmland. Unfortunately, recent trends pushing corn-based biofuels are not exactly aligned with this strategy:

Certain aspects of the nation’s current agricultural and energy policies are at odds with the goals of hypoxia reduction and improving water quality. . .[A]n emerging national strategy on renewable fuels has granted economic incentives to corn-based ethanol production.

Without some change to the current structure of economic incentives favoring corn-based ethanol, N[itrogen] loadings to the MARB from increased corn production could increase dramatically in coming years, rather than decreasing, as needed…

The alternative is cellulosic ethanol and avoiding corn-based fuels altogether:

Alternatively, the use of perennial crops and other feedstocks for cellulosic ethanol requires a more complex refining process that produces more net energy and results in lower fertilization and thus less nutrient runoff than corn-based ethanol.

The Dead Zone in the Gulf of Mexico is a symptom our farming practices, and converting cropland to grow fuel will only exacerbate the problem. This is just another chapter in the corn-based ethanol saga. The EPA’s Science Advisory Board will vote on approval of the draft report in December.

Green Car Congress: EPA Science Advisory Board Suggests Revisions to Ethanol Incentives Necessary to Reduce Gulf of Mexico “Dead Zone”
Science Advisory Board (SAB) Hypoxia Panel Draft Advisory Report

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Jimmy: Public transportation is a blessing to metropolitan areas where well designed mass transit systems help reduce traffic congestion and related pollution. It's also nice to sip a hot cup of coffee and read the paper while leaving the business of driving to someone else. Planning and management of these systems is the key though in having successful acceptance by a society of car drivers accustomed to the flexibility of operating on their own schedule.

The point that must be kept in mind is that public transportation is a medicine for a specific ailment and that trying to administer this remedy in areas that are more suburban than urban is often costly and unsuccessful; sometimes doing more harm than good. Policy makers must also distinguish between the goal of alleviating traffic(along with its associated ills) and social welfare in the form of subsidized transportation costs because these can sometimes be at odds.

Shirley: The time is fast coming when America will need to radically rethink its approach to transportation, both short- and long-distance. The forces converging to drive such change include rising fuel prices, the growing need to reduce greenhouse gas emissions, a federal highway trust fund that's falling short of covering infrastructure construction, maintenance and repair needs, and an aging U.S. population in which a growing number of citizens will be unable or unwilling to continue driving in coming years.

Public transit ridership has been increasing in recent years and polls show many Americans want more public transportation options. That trend is only likely to grow as gas prices keep rising (and they will: analysts are already predicting $4 a gallon pump prices as this summer's travel season gets under way). Many cities today are exploring or implementing new programs such as light-rail systems, while some states struggling to make ends meet are considering privately maintained toll roads. As with efforts to curb global warming, it's clear that the federal government is lagging far behind what its citizens want in terms of transportation alternatives. Public transit won't solve all our transportation problems, but it needs to be offered in far more widespread and creative ways than it is at present.

Now don't get me wrong: it's not farm subsidies and certainly not alternative fuel subsidies that I have a problem with. I just think that the government should encourage farmers to grow (organic and sustainable) food, not fuel. It should also support those alternative fuels and technologies that provide a demonstrable measure of increased efficiency and decreased reliance on fossil fuels. Ethanol does neither.

You may recall hearing about a report by UC Berkeley geoengineering professor Tad Patzek and Cornell ecology professor David Pimentel that concluded that it takes more energy to make ethanol than the finished ethanol actually contains:

The two scientists calculated all the fuel inputs for ethanol production—from the diesel fuel for the tractor planting the corn, to the fertilizer put in the field, to the energy needed at the processing plant—and found that ethanol is a net energy-loser. According to their calculations, ethanol contains about 76,000 BTUs per gallon, but producing that ethanol from corn takes about 98,000 BTUs.

Those 98,000 BTUs of energy? They come mostly from fossil fuels. I'll freely admit that the results and biases of the Pimentel/Patzek report have been the subject of much debate and consternation from ethanol supporters, but it's clear that producing ethanol from corn requires lots of energy. Even with the American Coalition for Ethanol's best case estimates, it still takes a half gallon of fossil fuel to make a gallon of ethanol.

It's one reason why you'll have to forgive me for choosing not to get too giddy when American automakers start mass-producing vehicles that get 10 miles per ethanol gallon.

There are other reasons too. First, with a still-growing population, with poverty and malnutrition still a global problem, and with the unpredictable results of global climate change, do we really want to devote an increasing amount of productive farmland to growing fuel? Pimentel has aptly called government support of ethanol "subsidized food burning." If we do allow food and fuel to fight over farm acreage, we would also have to be prepared to accept the unsustainable industrialized farming of corn monocultures (in the U.S.) that would be required for ethanol to make a dent in America's fuel demands.

As a biodiesel homebrewer, I have many of the same concerns about large-scale biofuel production (and subsidies, too). The vegetable oil I use for biodiesel has already served it's purpose as fryer oil at a local restaurant. I take that waste product and turn it into fuel. Using virgin oil fresh from America's farms makes little sense to me. Even so, and even though I use some really gross, inedible waste oil, my wife and I are still planning to move beyond biodiesel and build an all-electric car later this year that will be fueled by solar energy.

With all of that said, I am still hopeful about the possibilities of the next generation of ethanol. There have been some promising advances in producing ethanol (bioethanol) from agricultural wastes, not virgin crops. These advances are indeed exciting and certainly worthy of being pursued further. Using waste to produce ethanol "would allow agricultural land to be used more efficiently and at the same time prevent competition with food supplies." (And just as bioethanol may be a solution for a more rational ethanol future, algae oil may prove to be the biofuel answer.)

Ethanol can play a role in America's clean, independent energy future, but it's important to remember that it's just one (small?) piece of the puzzle. Many of the best minds in the environmental movement have been telling us for decades that there is no one perfect answer. I think they're right. We don't need ethanol alone, or biofuels alone, or solar panels alone, or wind farms alone, or hydrogen alone, or conservation alone. We need all of them and more.