The Great Ethanol Scam
Posted: Sat May 16, 2009 7:58 am
The Great Ethanol Scam
http://www.businessweek.com/lifestyle/c ... e+subindex
Not only is ethanol proving to be a dud as a fuel substitute but there
is increasing evidence that it is destroying engines in large numbers
By Ed Wallace
"Does the average citizen understand what this means? In from 10 to 20
years this country will be dependent entirely upon outside sources for
a supply of liquid fuels … paying out vast sums yearly in order to
obtain supplies of crude oil from Mexico, Russia, and Persia."—Yale
Professor Harold Hibbert, ethanol promoter, 1925
More than one major transportation-based industry in America besides
Detroit is on the ropes. For the fourth time in our history the
ethanol industry has come undone and is quickly failing nationally. Of
course it's one thing when Detroit collapsed with the economy; after
all, that is a truly free-market enterprise and the economy hasn't
been good. But the fact that the ethanol industry is going bankrupt,
when the only reason we use this additive is a massive government
mandate, is outrageous at best.
Then again, the ethanol lobby and refiners have a solution to
ethanol's failure in America: Hire retired General Wesley Clark as
your point man and lobby the government to increase the amount of
ethanol in our fuel to 15%. The problems with that proposition are
real—unlike ethanol's benefits.
Where's the Logic?
First, the primary job of the Environmental Protection Agency is, dare
it be said, to protect our environment. Yet using ethanol actually
creates more smog than using regular gas, and the EPA's own attorneys
had to admit that fact in front of the justices presiding over the
Third Circuit Court of Appeals in 1995 (API v. EPA).
Second, truly independent studies on ethanol, such as those written by
Tad Patzek of Berkeley and David Pimentel of Cornell, show that
ethanol is a net energy loser. Other studies suggest there is a small
net energy gain from it.
Third, all fuels laced with ethanol reduce the vehicle's fuel
efficiency, and the E85 blend drops gas mileage between 30% and 40%,
depending on whether you use the EPA's fuel mileage standards
(fueleconomy.gov) or those of the Dept. of Energy.
Fourth, forget what biofuels have done to the price of foodstuffs
worldwide over the past three years; the science seems to suggest that
using ethanol increases global warming emissions over the use of
straight gasoline. Just these issues should have kept ethanol from
being brought back for its fourth run in American history.
Don't let anybody mislead you: The new push to get a 15% ethanol
mandate out of Washington is simply to restore profitability to a
failed industry. Only this time around those promoting more ethanol in
our gas say there's no scientific proof that adding more ethanol will
damage vehicles or small gas-powered engines. With that statement
they've gone from shilling the public to outright falsehoods, because
ethanol-laced gasoline is already destroying engines across the
country in ever larger numbers.
Got a Spare $1,000?
Last July was bad enough for motorists on a budget—gasoline prices had
shot up to more than $4 a gallon. But for some the pain in the
pocketbook was about to get worse. At City Garage in Euless, Tex., for
example, the first of numerous future customers brought in an
automobile whose fuel pump was shot. A quick diagnosis determined that
that particular car had close to 18% ethanol in the fuel. For that
unlucky owner, the repairs came to nearly $900. The ethanol fun was
just beginning.
City Garage manager Eric Greathouse has found that adding ethanol to
the nation's gasoline supply may be a foolish government mandate, but
it has an upside he'd rather not deal with. It's supplying his shop
with a slow but steady stream of customers whose plastic fuel intakes
have been dissolved by the blending of ethanol into our gasoline, or
their fuel pumps destroyed. The average cost of repairs is just shy of
$1,000.
It gets better. Scott Morrison is the owner of the City Garage chain
in North Texas and he related the story of his technical director's
run-in with ethanol; in December he filled up his E85 Flex Fuel Chevy
Suburban at the Exxon station in Ovilla, just south of Dallas. His
Suburban died on the spot, because even an E85-equipped vehicle will
not run on the 100% pure ethanol that Exxon station was pumping that
day. In that case it was not Exxon's fault but a mistake at the
distribution center, and Exxon (XOM) quickly made good for the cost of
repairs.
On Jan. 16 of this year, Lexus ordered a massive recall of certain
2006 to 2008 models, including the GS Series, IS and LS sedans.
According to the recall notice, the problem is that "Ethanol fuels
with low moisture content will corrode the internal surface of the
fuel rails." In layman's terms, ethanol causes pinpoint leaks in the
fuel system; when leaking fuel catches your engine on fire, that's an
exciting way to have your insurance company buy your Lexus. Using
ethanol will cost Toyota (TM) untold millions.
An Unpublicized Trend
Though the media is ignoring it, one can easily find many stories on
BMW (BMWG.DE) blogs relating similar problems with fuel systems
damaged by the use of ethanol. Certainly that was the case with
Christi Jordan and her 2007 Mini. For weeks it was difficult to start;
Moritz BMW in Arlington, Tex., inspected it and found severe carbon
buildup inside the engine. On her second trip to the mechanics they
decided to test the ethanol content of Christi's fuel and found it was
much higher than the federally mandated limit of 10%. This time the
fuel pump had been destroyed by the ethanol. The repair bill came to
$1,200: As in all cases where vehicles are damaged by ethanol, legally
the factory warranty no longer applied.
Jim Keppler, Moritz's fixed operations director, said he's had at
least 10 other cases of ethanol poisoning in Minis over the past six
months. Christi was one of the lucky ones; Moritz covered her repairs.
But there's no telling how many motorists across the nation have had
to pay for fuel pumps, or fuel systems, that ethanol damaged. Most
were probably unaware of the real culprit behind the breakdown,
because virtually no repair shop tests the level of ethanol in the
gasoline when these fuel system problems occur.
And there are active lawsuits from boat owners; ethanol broke down the
resins in their fiberglass gas tanks, destroying their marine engines.
Additionally, those who deal in small gas engines for lawnmowers,
edgers, and weedeaters have quickly learned that, as Briggs &
Stratton's (BGG) Web site warns, "Ethanol-blended gasoline can attract
moisture, which leads to separation and formation of acids during
storage. Acidic gasoline can damage the fuel system of an engine while
in storage. B&S strongly recommends removing ethanol-blended fuels
from engine during storage."
Like motorists, if landscaping tool owners put gasoline with more than
10% ethanol in their small engines, that immediately voids any factory
warranties. In the case of the Lexus recall, using just a 10% ethanol
blend was found to be destroying many of these engines also.
Another Government-Mandated Mistake
It now appears that in just a few years since the government forced
ethanol use on the country, engine and fuel system failures caused by
ethanol are causing major damage to more and more new and used
vehicles. This means the hapless owners are not only paying for snake
oil in lower fuel efficiency and more smog, but pay again when it
damages their vehicles and lawn mowers.
We seem to have forgotten, but the promise of turning over farmland
for fuel production was to reduce our nation's demand for imported
crude. But until this massive economic slowdown, as Gusher of Lies
(PublicAffairs, 2008) author Robert Bryce pointed out, even while the
ethanol mandate was being ramped up we were increasing our imports of
foreign oil.
Translation: The entire politically stated purpose of using ethanol
had already been proven to be a false one before the program even got
fully under way.
No surprise there. The premise that ethanol could give America the
freedom to one day stop importing oil has always been fraudulent.
Another fun fact: If we outlawed gasoline and diesel, thereby removing
every last car, truck and SUV from our highways—no vehicles anywhere
on any road in the country—America would still have to import oil
because we would still use more crude than domestic production can
supply.
Why is that? Crude oil is also used to make fertilizers, aviation
fuel, home heating oil, and many other products. Not to mention
polyester suits for car salesmen.
Comment Now, Public!
Pushed into it by the corn growers' and ethanol refiners' lobbying
organizations, today the EPA is starting to go through the public
comment phase on increasing the level of ethanol in our gasoline from
10% to 15%. Time and time again we have heard from these groups, who
now claim that there is zero scientific evidence that a 15% blend of
ethanol would do any damage whatsoever if the mandate for ethanol were
raised. As with all statements made by vested interests, few outsiders
have actually taken the time to look and find out whether this
statement was true.
In fact, it's false.
Not one mechanic I've spoken with said they would be comfortable with
a 15% blend of ethanol in their personal car. However, most suggest
that if the government moves the ethanol mandate to 15%, it will be
the dawn of a new golden age for auto mechanics' income.
One last thought: Most individuals who have had to repair their fuel
systems in recent years never had the gasoline tested to see if the
ethanol percentage might be the problem. Today most repair shops and
new-car dealers are still not testing for ethanol blends. They're
simply repairing the vehicles and sending their unhappy and less
wealthy customers on their way. But, where dealer and repair shops are
testing the gasoline, ethanol is becoming one of the leading culprits
for the damage.
Sadly, when a truly bad idea is exposed today, Washington's answer is
to double-down on the bet, mandate more of the same, and make the
problem worse. Only this time around motorists will be able to gauge
the real cost of ethanol when it comes time to fix their personal
cars.
Ed Wallace is a recipient of the the Gerald R. Loeb Award for business
journalism, given by the G. and R. Loeb Foundation, and is a member of
the American Historical Society. His column leads the Fort Worth
Star-Telegram's "Sunday Drive" section. He reviews new cars every
Friday morning at 7:15 on Fox Four's Good Day, contributes articles to
BusinessWeek Online, and hosts the top-rated talk show Wheels
Saturdays from 8 a.m. to 1 p.m. on 570 KLIF.
http://www.businessweek.com/lifestyle/c ... e+subindex
Not only is ethanol proving to be a dud as a fuel substitute but there
is increasing evidence that it is destroying engines in large numbers
By Ed Wallace
"Does the average citizen understand what this means? In from 10 to 20
years this country will be dependent entirely upon outside sources for
a supply of liquid fuels … paying out vast sums yearly in order to
obtain supplies of crude oil from Mexico, Russia, and Persia."—Yale
Professor Harold Hibbert, ethanol promoter, 1925
More than one major transportation-based industry in America besides
Detroit is on the ropes. For the fourth time in our history the
ethanol industry has come undone and is quickly failing nationally. Of
course it's one thing when Detroit collapsed with the economy; after
all, that is a truly free-market enterprise and the economy hasn't
been good. But the fact that the ethanol industry is going bankrupt,
when the only reason we use this additive is a massive government
mandate, is outrageous at best.
Then again, the ethanol lobby and refiners have a solution to
ethanol's failure in America: Hire retired General Wesley Clark as
your point man and lobby the government to increase the amount of
ethanol in our fuel to 15%. The problems with that proposition are
real—unlike ethanol's benefits.
Where's the Logic?
First, the primary job of the Environmental Protection Agency is, dare
it be said, to protect our environment. Yet using ethanol actually
creates more smog than using regular gas, and the EPA's own attorneys
had to admit that fact in front of the justices presiding over the
Third Circuit Court of Appeals in 1995 (API v. EPA).
Second, truly independent studies on ethanol, such as those written by
Tad Patzek of Berkeley and David Pimentel of Cornell, show that
ethanol is a net energy loser. Other studies suggest there is a small
net energy gain from it.
Third, all fuels laced with ethanol reduce the vehicle's fuel
efficiency, and the E85 blend drops gas mileage between 30% and 40%,
depending on whether you use the EPA's fuel mileage standards
(fueleconomy.gov) or those of the Dept. of Energy.
Fourth, forget what biofuels have done to the price of foodstuffs
worldwide over the past three years; the science seems to suggest that
using ethanol increases global warming emissions over the use of
straight gasoline. Just these issues should have kept ethanol from
being brought back for its fourth run in American history.
Don't let anybody mislead you: The new push to get a 15% ethanol
mandate out of Washington is simply to restore profitability to a
failed industry. Only this time around those promoting more ethanol in
our gas say there's no scientific proof that adding more ethanol will
damage vehicles or small gas-powered engines. With that statement
they've gone from shilling the public to outright falsehoods, because
ethanol-laced gasoline is already destroying engines across the
country in ever larger numbers.
Got a Spare $1,000?
Last July was bad enough for motorists on a budget—gasoline prices had
shot up to more than $4 a gallon. But for some the pain in the
pocketbook was about to get worse. At City Garage in Euless, Tex., for
example, the first of numerous future customers brought in an
automobile whose fuel pump was shot. A quick diagnosis determined that
that particular car had close to 18% ethanol in the fuel. For that
unlucky owner, the repairs came to nearly $900. The ethanol fun was
just beginning.
City Garage manager Eric Greathouse has found that adding ethanol to
the nation's gasoline supply may be a foolish government mandate, but
it has an upside he'd rather not deal with. It's supplying his shop
with a slow but steady stream of customers whose plastic fuel intakes
have been dissolved by the blending of ethanol into our gasoline, or
their fuel pumps destroyed. The average cost of repairs is just shy of
$1,000.
It gets better. Scott Morrison is the owner of the City Garage chain
in North Texas and he related the story of his technical director's
run-in with ethanol; in December he filled up his E85 Flex Fuel Chevy
Suburban at the Exxon station in Ovilla, just south of Dallas. His
Suburban died on the spot, because even an E85-equipped vehicle will
not run on the 100% pure ethanol that Exxon station was pumping that
day. In that case it was not Exxon's fault but a mistake at the
distribution center, and Exxon (XOM) quickly made good for the cost of
repairs.
On Jan. 16 of this year, Lexus ordered a massive recall of certain
2006 to 2008 models, including the GS Series, IS and LS sedans.
According to the recall notice, the problem is that "Ethanol fuels
with low moisture content will corrode the internal surface of the
fuel rails." In layman's terms, ethanol causes pinpoint leaks in the
fuel system; when leaking fuel catches your engine on fire, that's an
exciting way to have your insurance company buy your Lexus. Using
ethanol will cost Toyota (TM) untold millions.
An Unpublicized Trend
Though the media is ignoring it, one can easily find many stories on
BMW (BMWG.DE) blogs relating similar problems with fuel systems
damaged by the use of ethanol. Certainly that was the case with
Christi Jordan and her 2007 Mini. For weeks it was difficult to start;
Moritz BMW in Arlington, Tex., inspected it and found severe carbon
buildup inside the engine. On her second trip to the mechanics they
decided to test the ethanol content of Christi's fuel and found it was
much higher than the federally mandated limit of 10%. This time the
fuel pump had been destroyed by the ethanol. The repair bill came to
$1,200: As in all cases where vehicles are damaged by ethanol, legally
the factory warranty no longer applied.
Jim Keppler, Moritz's fixed operations director, said he's had at
least 10 other cases of ethanol poisoning in Minis over the past six
months. Christi was one of the lucky ones; Moritz covered her repairs.
But there's no telling how many motorists across the nation have had
to pay for fuel pumps, or fuel systems, that ethanol damaged. Most
were probably unaware of the real culprit behind the breakdown,
because virtually no repair shop tests the level of ethanol in the
gasoline when these fuel system problems occur.
And there are active lawsuits from boat owners; ethanol broke down the
resins in their fiberglass gas tanks, destroying their marine engines.
Additionally, those who deal in small gas engines for lawnmowers,
edgers, and weedeaters have quickly learned that, as Briggs &
Stratton's (BGG) Web site warns, "Ethanol-blended gasoline can attract
moisture, which leads to separation and formation of acids during
storage. Acidic gasoline can damage the fuel system of an engine while
in storage. B&S strongly recommends removing ethanol-blended fuels
from engine during storage."
Like motorists, if landscaping tool owners put gasoline with more than
10% ethanol in their small engines, that immediately voids any factory
warranties. In the case of the Lexus recall, using just a 10% ethanol
blend was found to be destroying many of these engines also.
Another Government-Mandated Mistake
It now appears that in just a few years since the government forced
ethanol use on the country, engine and fuel system failures caused by
ethanol are causing major damage to more and more new and used
vehicles. This means the hapless owners are not only paying for snake
oil in lower fuel efficiency and more smog, but pay again when it
damages their vehicles and lawn mowers.
We seem to have forgotten, but the promise of turning over farmland
for fuel production was to reduce our nation's demand for imported
crude. But until this massive economic slowdown, as Gusher of Lies
(PublicAffairs, 2008) author Robert Bryce pointed out, even while the
ethanol mandate was being ramped up we were increasing our imports of
foreign oil.
Translation: The entire politically stated purpose of using ethanol
had already been proven to be a false one before the program even got
fully under way.
No surprise there. The premise that ethanol could give America the
freedom to one day stop importing oil has always been fraudulent.
Another fun fact: If we outlawed gasoline and diesel, thereby removing
every last car, truck and SUV from our highways—no vehicles anywhere
on any road in the country—America would still have to import oil
because we would still use more crude than domestic production can
supply.
Why is that? Crude oil is also used to make fertilizers, aviation
fuel, home heating oil, and many other products. Not to mention
polyester suits for car salesmen.
Comment Now, Public!
Pushed into it by the corn growers' and ethanol refiners' lobbying
organizations, today the EPA is starting to go through the public
comment phase on increasing the level of ethanol in our gasoline from
10% to 15%. Time and time again we have heard from these groups, who
now claim that there is zero scientific evidence that a 15% blend of
ethanol would do any damage whatsoever if the mandate for ethanol were
raised. As with all statements made by vested interests, few outsiders
have actually taken the time to look and find out whether this
statement was true.
In fact, it's false.
Not one mechanic I've spoken with said they would be comfortable with
a 15% blend of ethanol in their personal car. However, most suggest
that if the government moves the ethanol mandate to 15%, it will be
the dawn of a new golden age for auto mechanics' income.
One last thought: Most individuals who have had to repair their fuel
systems in recent years never had the gasoline tested to see if the
ethanol percentage might be the problem. Today most repair shops and
new-car dealers are still not testing for ethanol blends. They're
simply repairing the vehicles and sending their unhappy and less
wealthy customers on their way. But, where dealer and repair shops are
testing the gasoline, ethanol is becoming one of the leading culprits
for the damage.
Sadly, when a truly bad idea is exposed today, Washington's answer is
to double-down on the bet, mandate more of the same, and make the
problem worse. Only this time around motorists will be able to gauge
the real cost of ethanol when it comes time to fix their personal
cars.
Ed Wallace is a recipient of the the Gerald R. Loeb Award for business
journalism, given by the G. and R. Loeb Foundation, and is a member of
the American Historical Society. His column leads the Fort Worth
Star-Telegram's "Sunday Drive" section. He reviews new cars every
Friday morning at 7:15 on Fox Four's Good Day, contributes articles to
BusinessWeek Online, and hosts the top-rated talk show Wheels
Saturdays from 8 a.m. to 1 p.m. on 570 KLIF.