Too sexy for my tank

Will Washington state take on Big Oil?

Posted by biodiversivist (Guest Contributor) at 2:03 PM on 16 Dec 2005

The front-page story for the Seattle Weekly tells us that Washington State is going to take on Big Oil and that:

The sexy star of the industry is biodiesel. Although there is only one biodiesel refinery in the state, which employs 12 people, and no biodiesel crops are grown commercially in Washington, biodiesel has captured the media's, the public's, and the politicians' imaginations.

Part of the plan includes a new law that will require the use of up to 10 percent biofuels to run vehicles in the state. This reminds me of how the old Soviet Union ran its economy (into the ground). "You will produce and buy whatever the state tells you to produce and buy regardless of cost because we know what is best for you. The free market is for capitalist pigs." Nevermind that much of this biofuel will eventually be coming from big oil, or at least its equivalent. Turns out that Shell Oil has invested in a company building a cellulosic ethanol plant just one state over.

Has Shell invested in ethanol to save the planet or to capitalize on the money to be made when a state mandates usage of a given product regardless of cost, insuring a captive market for that product? I wonder.

We are reminded of how the big energy companies have taken advantage of us:

Hurricanes Katrina and Rita disrupted oil and gas supplies, driving prices higher, and created opportunities for profiteering by big energy companies.

Why does the author think that profiteering will end if you replace oil with biodiesel or ethanol? A drought-induced crop failure has just as much potential to send the price of ethanol or biodiesel through the roof. Also, most successful small companies eventually become large companies either through growth or by being bought out by the competition. Now, we can fix that problem with yet another law that makes it illegal to become a big company. But wait a minute, since when are small companies less likely to profiteer than big companies? This is my point. Government interference in free markets can be highly detrimental, as can government decisions that send us to war by accident.

Which leads me to the next problem with this piece. The author makes repeated references to the Iraq war to bolster the importance of biofuels (biodiesel in particular). It has been pretty well established that the U.S. gets only about 10 percent of its oil from the Middle East. Let's face it, our intellectually challenged president did not go to war to protect our supply of oil. He did it to protect us from "terists."

The disastrous invasion of Iraq, of course, has highlighted the military and political costs of dependence on oil from the Middle East ...
... the nightly news brings flesh-and-blood reminders of the cost of our reliance on Middle East oil.
... but if we need any flesh-and-blood reminder of how disastrous our nation's current energy policy is, just turn on the nightly news and be reminded of the cost of our reliance on Middle East oil. While a clean-energy future seems a challenge, it's unimaginable that a dirty, blood-soaked energy future will be possible to bear.

Now, I voted for Governor Gregoire, but this comment lowered my left eyebrow while raising my right one:

"We are a coastal state fighting desperately against global warming."

The article did contain brief periods of lucidity:

In the short term, all of this protest and recognition of problems isn't going to do anything to change the high cost of energy or dependence on foreign oil. "Americans will spend over $200 billion more on energy this year than they did last year," says Cantwell, a member of the Senate energy committee.

And ...

Biodiesel's big disadvantage is that it costs more to buy than conventional diesel. Last week, at Laurelhurst Oil, a University District gas station, conventional diesel was selling for $2.79 per gallon, while biodiesel cost $3.17.

This might explain why my neighbor's diesel Jetta is not being driven as often as the gas Honda.

Remarks like this always get me:

The idea is that if the United States can produce its own energy instead of relying on imported fuel, there will be geopolitical benefits, too.

The lion's share of U.S. CO2 production does not come from imported fuel, it comes from coal. It is our transportation that uses oil, which produces only 25 percent of our CO2. It is not possible to grow enough of our own transportation fuel "domestically" to make a dent in this (let me know if you want to see the math). In addition, biodiesel will eventually be made from soybeans grown in the Amazon or from palm oil grown in Indonesia because that is where the cheapest sources will be because that is where the rainforests are that can be converted to more cropland. Using biodiesel is not going to reduce our reliance on imported fuel. It will only change whom we are reliant on.

The author first defends the free market:

Our national government is a pipeline of corporate welfare for environment-besmirching oil and gas companies.

He then turns right around and enthusiastically tells us about our state government's plan to provide a pipeline of corporate welfare for jungle-, land-, and crop-consuming biodiesel companies:

Democrats agree there will be a host of tax breaks for everything connected to biodiesel, but some legislators want to go further.

And ...

House Capital Budget Committee Chair Hans Dunshee, D-Snohomish, wants to use state money to build the big, expensive crushers that convert oil-seed crops into oil. Since the state constitution prohibits direct payments to private industry, Dunshee says the money would likely go to an eastern Washington port district or some other governmental entity."

The author tries to reassure us that this show is not being run by a bunch of liberal environmental nutjobs:

... the industry is not one of anticapitalist ecotopians. The fuel's source is produced by agribusiness cooperatives in the Midwest that grow soybeans conventionally and have banded together to build refineries to supply a new market.

In other words, the industry is being run by capitalist anti-ecotopians.

The company started two years ago when commercial airline pilot John Plaza, now the company's president, mortgaged his home, sold his boats and cars, and borrowed against his 401(k) plan to get the alternative fuels venture up and running.

What are the odds that when Shell, BP, or Exxon, eventually buys these guys out they will skip to the bank blowing raspberries at every environmentalist they meet?

The bottom line is this. Biodiesel is all about making money. Which is fine with me as long as you don't destroy anymore of the face of the planet to make that money. Biodiesel cannot provide meaningful amounts of fuel without usurping existing cropland and creating more cropland out of rainforests. It does not make sense from an environmental perspective. Like nuclear, it will create more environmental problems than it solves. The problem is that no one has told the politicians this yet. They are looking at it less from an environmental perspective than from a political one:

The alliance believes such an undertaking would create 2 million to 3 million new, high-paying, permanent jobs ...
Washington politicians are giddy about biodiesel. It's easy to see why. Gov. Gregoire quotes John Steinbeck: "The bank is more than men; it is a monster." Says the governor, "Replace bank with foreign oil." She sees biodiesel as an opportunity to tear down the Cascade Curtain and unite the red and blue parts of the state. "This is an opportunity for us to work together as a state," she says enthusiastically. Washington has the agricultural potential east of the mountains to grow oil-seed crops. Mustard seed and canola seed (aka rapeseed) are the most frequently mentioned. Oil-seed crops can be grown in rotation with others -- wheat, for instance -- throughout eastern Washington. Western Washington consumers, with their liberal politics and environmental values, represent a great market for the product -- even if it's more expensive.

That part about environmental values will change once word finally gets out that biofuels are anything but environmentally friendly. My other hope is that some technological breakthroughs will come along in time to crush this thing before it does any more damage. New battery technology could finally usher in viable electric cars. I'm just keeping my fingers crossed. But hey, other than these few problems, I thought it was a great article.

For story: Too sexy for my tank
4 Comments | Post a Comment

Biodiversivist, ever the biofuel hater...

I understand your biggest beef with biofuels, that they will eventually come from nations that will be tearing down rainforests to produce biofuels. I too share the same concerns, but that does not dismiss the benefits of biofuels as a domestically produced resource.

1) You say...

"Nevermind that much of this biofuel will eventually be coming from big oil, or at least its equivalent. Turns out that Shell Oil has invested in a company building a cellulosic ethanol plant just one state over. Has Shell invested in ethanol to save the planet or to capitalize on the money to be made when a state mandates usage of a given product regardless of cost, insuring a captive market for that product? I wonder."

Because we all know that all big businesses are bad, no matter what they support. If its profitable, it surely must be evil, right? Ideally, strong environmental solutions should be profitable, and biofuels have that potential. Maintaining this viewpoint that environmental solutions should cost more has plagued the movement for years, thank god we're finally moving away from that with biofuels, green building, and the economic opportunities inherent in developing energy saving technologies.

"It has been pretty well established that the U.S. gets only about 10 percent of its oil from the Middle East. Let's face it, our intellectually challenged president did not go to war to protect our supply of oil. He did it to protect us from 'terists.'"

Although we only receive 10% of our oil from the mid-east, that's nothing to sneeze at. Moreover, a steady supply of mideast oil affects the entire world economy. Europe receives 30% of their oil from the middle east and Japan 80%. The global economy affects the U.S. economy. It's naive to say that oil didn't play a part of our war in Iraq.

"It is our transportation that uses oil, which produces only 25 percent of our CO2. It is not possible to grow enough of our own transportation fuel "domestically" to make a dent in this (let me know if you want to see the math). In addition, biodiesel will eventually be made from soybeans grown in the Amazon or from palm oil grown in Indonesia because that is where the cheapest sources will be because that is where the rainforests are that can be converted to more cropland. Using biodiesel is not going to reduce our reliance on imported fuel. It will only change whom we are reliant on."

Transportation produces 30% of world's CO2, the largest single source of CO2 in the world. For you to say "only" 25 percent is laughable.

To be clear, the Washington State bill that you cite is designed to encourage biodiesel production in Washington, not in the Amazon or Indonesia. We can all agree that biofuels derived from what used to be rainforests is a bad idea. We should be able to all agree that domestically produced biodiesel, particularly locally grown in Washington, is worth championing.

"What are the odds that when Shell, BP, or Exxon, eventually buys these guys out they will skip to the bank blowing raspberries at every environmentalist they meet?"

I've met John Plaza and his goal is promote sustainable biofuels grown in his community. For you to imply that he's in it to profit and skip town to rub it in the faces of environmentalists is an outrage, one that you should be ashamed of.

"It does not make sense from an environmental perspective. Like nuclear, it will create more environmental problems than it solves."

Biofuels produced from domestic crops, cellulosic ethanol, and biodiesel derived from plants like canola, rapeseed and even algae (should that technology progress), and biofuels derived from waste vegetable oil are highly sustainable and outstanding for the environment. Again, you're big beef, and it's a good one, is about biofuels derived from crops that usurp rainforest land. I agree with you but that does not make all biofuels bad for the environment, you're just plain wrong. How many of your readers think biofuels derived from waste vegetable oil is bad for the environment? Yet you make this sweeping statement I quoted. Perhaps you would do you readers a better service to qualify biofuels derived from certain feedcrops or imported biofuels, but it's irresponsible to lump them all together, and declare them bad for the environment.

If your readers look at the prior threads you have created here on Grist, it's clear that you have an axe to grind. It's certainly not objective journalism, readers beware.

by greenstork at 4:57 PM on 16 Dec 2005

Soviet Repulics?

Comparing an environmental mandate in an american state to the economies of former soviet republics is spurious at best. It reads dramatically, I guess. I agree that market distortions aren't always economically healthy, but addressing externalities is one of the core justifications for the existence of any government at all. Low flow toilets and shower heads are good examples of what Jamais Cascio refers to as beneficial "eco-stalinism" or mandated change - I take it you'd just leave it to the market to manage water resources?

http://www.sustainabilityzone.com

by dreadsword at 3:21 PM on 17 Dec 2005

Buy American?

Greenstork, Monbiot wasn't kidding when he said:

The last time I drew attention to the hazards of making diesel fuel from vegetable oils, I received as much abuse as I have ever been sent by the supporters of the Iraq war. The biodiesel missionaries, I discovered, are as vociferous in their denial as the executives of Exxon.

From your last two posts:

Shame on the finger pointers...For you to say "only" 25 percent is laughable...you should be ashamed... it's clear that you have an axe to grind. It's certainly not objective journalism, readers beware.

I can empathize. Some people (not necessarily you) are emotionally invested in biodiesel (and if they paid tens of thousands for a diesel car, they are also monetarily invested). I am emotionally invested in saving our remaining biodiversity.

You have mentioned several times that biodiesel can be made from used cooking oil, and I have said numerous times that I see nothing wrong with that. Everyone also knows by now that biodiesel produces little CO2. I don't think I need to reiterate those facts with every post. They are largely irrelevant to my arguments anyway. Again, Monbiot says it better than I could:

I should make it clear that turning used chip fat into motor fuel is a good thing. But there is enough waste cooking oil in the UK to meet a 380th [0.026 %] of our demand for road transport fuel.

It is also a moot point because cooking oil is already recycled to fuel boilers, feed livestock, make pet food and on and on. Using it to make biodiesel just takes it from other recyclers. The fact that it can be recycled as a fuel for cars is largely irrelevant. It gets recycled anyway.

In one of your earlier posts you articulately and concisely stated your position:

And obviously, commodity biodiesel, imported from foreign countries that are stripping down rainforests is indefensible. If this trend continues, then I'll likely be changing my tune. But as long as my biodiesel is produced domestically, I'm still a supporter. It's almost the same as making an effort to buy local produce.

The local produce analogy is a good one. But, for the sake of discussion, what if I went out tomorrow, sold my house, cars, and cashed out my 401K to build a refinery in Seattle. Let's then say that I struck a deal with Brazil, the Congo, or Indonesia for a shipment of oil that cost far less than what Midwest (or Washington) farmers could sell it for. Assume the price is the result of the low cost of farmland (you really need to click on this link) created from freshly razed rainforests, and because the shipment arrives in bulk in giant ships at Seattle's port just a few miles down the railroad tracks from my refinery.

At that point, consumers will have to choose between biodiesel that costs much less or pay more to support American farmers (most likely from the Midwest). Efforts to promote the more expensive fuel will have the same limited success that promoting shade-grown coffee has had. So, regardless of what the original refiners choose to do, buy the cheapest oil themselves, shoot for a "buy American" niche market, or go out of business, rainforests will fall.

One of your earliest posts argued that biodiesel would not prove to be a cost effective export fuel. That argument as you have already pointed out has now fallen by the wayside. Your insistence that all biodiesel used in the US will be made from crops grown only in the US is naïve (to toss that hot-potato word back at you). Corporate welfare (tax cuts) and even the inevitable tariffs can hold the imports at bay only so long. Seattle's local refiners are using virgin oil from the Midwest. That is a far cry from using recycled cooking oil or even using rapeseed grown in Washington State. Calling that "local" produce is stretching the definition and it is just going to get worse as free market competition heats up.

Once an industry is established with an infrastructure and a large number of jobs, it can be difficult to pull the plug. Environmental concerns usually get a lower priority. My first post here lamented the brush picking industry which degrades our forests to this day.

One last thing:

Transportation produces 30% of world's CO2, the largest single source of CO2 in the world. For you to say "only" 25 percent is laughable.

It is understandable that you missed my point. I was not very specific. To be more specific, using all existing fallow cropland in the US (much of which is being used for wildlife habitat) to grow crops for biodiesel would supply about 6% of our cars, reducing total CO2 emissions by "only" half of one percent. Now, some might call that laughable, but I would rather not. Feel free to check my numbers, I have been known to make mistakes. I used 10% of our arable land as being fallow, 50 gallons of biodiesel per acre, biodiesel being 78% CO2 free.

500 gal per year / 50 gal per acre = 10 acres
470,000,000arable acres in US / 10 acres per car =47,000,000 cars.
47,000,000 cars can use biodiesel made from soybeans / 200,000,000 cars in US = 0.25 or 25% (a quarter of all cars in the US could use biodiesel if we used all of our cropland).
25% of 25%=6.25% reduction in CO2.
10% of that gives us 0.625% reduction in total US CO2
Reduce that by 22% you get 0.5 %

In the end, it all comes down to biodiversity. Poison Darts--Protecting the biodiversity of our world

by biodiversivist at 8:19 PM on 17 Dec 2005
[ Parent ]

Dreadsword,

Good government is a good thing (effective water management). Bad government is a bad thing (going to war by accident). The trick is defining good and bad. Governments have been known to make stupid decisions. I am arguing that this is one of them. Feel free to argue back. Nothing more boring than a forum where everyone agrees.

In the end, it all comes down to biodiversity. Poison Darts--Protecting the biodiversity of our world

by biodiversivist at 8:31 PM on 17 Dec 2005
[ Parent ]

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