Monday, May 08, 2006

The Ethanol Solution?

60 minutes gave a report by this title on Sunday night:
http://www.cbsnews.com/stories/2006/05/04/60minutes/main1588659.shtml

It was less than inspiring for me, not only because it neglects an honest cost-benefit analysis or any sort of scalability argument, but most of all because reports like this are like lullabies, lulling watchers into a false sense of security that things can go back to the good old days of cheap apparently unlimited energy.

I don't know if ethanol from corn is a true net energy source. I accept the possibility that it can reduce oil imports potentially. I accept the possibility that celluostic materials might someday be raw materials for ethanol production. There's numerous possible technical advances that may be within reach that'll help make a ethanol viable fuel.

What I don't see is any combination of solutions that will allow a "seamless transition" from past expectations into renewable production. I see every step, every "partial" solution in a transition will offer its own drawbacks and ultimately come out as higher energy costs.

From this perspective, I see a higher gasoline excise tax as a vital component to whatever transition we make. The fact is until we find our next standard, we're at risk, and so until we have a clear positive direction, the best solution is conservation - reducing our demand for energy and liquid fuels. And the best way to reduce demand is to guarantee higher prices - via fuel taxes.

I think I like the tax-exchange idea - reducing the payroll tax and substituting with a gasoline tax. This is the balance that lowers the cost of living for the lower income workers while rewarding decisions tha t reduce fuel consumption.

Anyway, I'm very disappointed in 60-minutes for their whitewashing. Even if we want to be optimistic, showing only the potential while neglecting difficulties means people will spend another year or whatever making decisions based on a hope fuel costs might go down again. And perhaps they will, for a time, and that's the problem. What sort of chump invests in alternative energy and inferior performance technology while there's still hope prices might go down?

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