I’ve recently said that the best way to invest in both Advanced Biofuels and Cellulosic Ethanol, and Biochar (aka terra preta) is to invest in Biomass. Here is one way to go about it: buying Forestry ETFs or Stocks.
Archive for Ethanol
Last week, I attended the 2009 Fuel Ethanol Workshop and the Advanced Biofuels Workshop, writing two articles. The first is a commentary on what the corn ethanol industry needs to do to rehabilitate its image, and the second looks into how the stock investor can benefit from emerging advanced biofuel, cellulosic ethanol, and
I’ve been obsessing about the best way to replace petroleum for transit fuels. Unlike venture capitalist Vinod Khosla, I think electricity will win the day over biofuels.. the cellulosic material can be put to better use.
This has lead to a series of articles over the last few months, and I thought I’d gather them all in one place, here:
E85, but no biodiesel. That’s Parker for you. And I was just talking about an ethanol glut!
Last year my wife and I read Michael Pollan’s The Omnivore’s
Dilemma, and it changed we eat. My wife was greatly affected by how animals are mistreated in production farming, while I was attracted by the health
benefits of eating grass fed beef and other foods grown in the manner to which they are evolutionarily adapted, as well as by the lower degree of harm to the environment. We haven’t become all-natural, all-organic, all-the-time at the Konrad household, but we’re now much more willing to pay more when we have the opportunity to do so for food which we consider healthier and more environmentally and morally sound. For a world-class tightwad like myself, being willing to pay more is a considerable step.
In any case, the book also got me thinking more sympathetically about the ethanol industry, because it serves as a relatively benign outlet for the mountain of corn produced by America’s insane farm policies. I find rising price of corn and other grains is more a cause for celebration than despair, because I see current prices more as a return to sanity rather than a likely cause for starvation. Even in the third world, low agricultural productivity is (in part) due to a lack of incentive to compete with subsidized first world production, rather than an inability to grow enough food. The market for corn has been massively distorted by oversupply caused by too many subsidies. Ethanol represents a new source of practically inexhaustible demand which is restoring balance to a market too long out of kilter.
One practice which the massive flood of cheap grain begat was feeding corn to cattle. In my AltEnergyStocks
column this week, I look at one way I think the market may be starting to find its equilibrium again. As corn prices rise, there will be less incentive to fatten cattle in feedlots (or Concentrated Agricultural Feeding Operations, CAFOs ad Michael Pollan calls them), and more to feed them grass. I believe that long before we can perfect the art of using energy crops such as switchgrass to make cellulosic ethanol on a commercial basis, the rising price of corn will make it economic to feed those same energy crops (i.e. grass) directly to cattle, more than doubling the amount of corn currently available to the ethanol industry.
I have a sequel to my article on the competitive landscape of the corn ethanol industry up today on Alt Energy Stocks. In it, I discuss insights I gained from a talk by Mark Wong, President and CEO of Renwable Agricultural Energy, a private corn ethanol producer.