Ethanol is a boon for fuel-starved nation, cleaner for air and saves you money

By Mike Geske

The major media outlets have been extremely critical of ethanol this past winter. News stories blasting ethanol have been plentiful. Articles paint ethanol as the scapegoat for causing food prices to soar, costing consumers additional money and polluting the environment. While we are all frustrated with skyrocketing energy costs, we need to look at the facts and not listen to the emotion.

For the last 10 years, average food-price inflation has been 2.9 percent. According to the U.S. Department of Agriculture, it was 4 percent last year, largely due to increased fuel and transportation costs. For every dollar that consumers spend on food, only about 20 cents goes back to the farm. Additionally, less than one-third of food products have corn as an ingredient, and most have only a small percentage of the ingredient.

USDA economist Ephraim Leibtag has stated that a 50 percent increase in the price of corn translates into less than a 1 percent increase in the price of food. In other words, it is difficult for the price of corn to have any perceptible influence on the price consumers pay at the grocery store.

John Urbanchuk, director with the economic consulting firm LECG, recently completed a study on the price effect of ethanol on gasoline in Missouri. He found that because of the low cost of ethanol, consumers will save an average of 9.8 cents on every gallon of gasoline purchased in Missouri this year.

In addition, a Merrill Lynch economist has calculated that gasoline prices would be 45 cents a gallon higher if we removed the 7 billion gallons of ethanol produced in the U.S. from gasoline markets. With the 3 billion gallons of gasoline per year that Missourians consume, the combined savings from these two figures amounts to annual savings of $1.6 billion dollars in Missouri alone.

The U.S. Environmental Protection Agency calculates that ethanol blends result in a 25 percent to 30 percent reduction in the emission of carbon monoxide, a precursor to ozone. St. Louis, Chicago, Houston and other major cities were unable to meet EPA's clean air requirements until they switched to ethanol blends. Today, after years of using ethanol-blended fuel, the air is cleaner in St. Louis.

For those who are still concerned about the energy efficiency of ethanol, I invite them to research studies completed by the U.S. Department of Energy, the Massachusetts Institute of Technology, the Argonne National Laboratory, the University of California-Berkeley and at least eight other research-based organizations have proven that ethanol is an energy efficient fuel. In fact, it is more energy efficient than gasoline and requires less water to produce.

While emotion and fear make for a good sound bite, the facts are indisputable. Ethanol is cleaner for the air, cleaner in your car and is saving consumers money. The U.S. is currently spending half a trillion dollars per year on foreign oil. That is almost $1.5 billion per day. Ethanol is currently the only available alternative. It is part of the solution. It is here now. It is something we can be proud of.

Mike Geske of Matthews, Mo., is a farmer and president of the Missouri Corn Growers Association.