Fined for Failing to Do the Impossible
11th January 2012
Back in 2007, Congress created a biofuels mandate under which oil companies are required to use a minimum amount of cellulosic ethanol each year. The mandate was supposed to encourage the development of a domestic cellulosic ethanol industry. This has not happened. Several years after the mandate was imposed, there is still no commercial cellulosic ethanol production. This gets the oil companies off the hook, right? Nope. As the New York Times reports, companies are still paying fines, totaling nearly $7 million, for failing to meet a blending quota for a substance that does not exist. Were that not bad enough, this year the cellulosic ethanol quota will increase, as will the fines for failing to meet it.
Of course. That makes perfect sense, to a bureaucrat. The important thing is not that people comply with the law, but that people not comply with the law, and cough up a ransom for not doing so.
As Green notes, Congress might as well have mandated oil companies blend gasoline with rainbows and unicorn sweat.
That’s phase 2, if Obama gets re-elected.
January 11th, 2012 at 08:04
Of course the alternative would be the oil companies getting together and developing a cellulose ethanol process which would then avoid the fines. Can’t have that; cheaper to pay the $7 million. After all, it’s only .001% of profits for one quarter.
January 11th, 2012 at 11:40
If a viable cellulose ethanol process existed, the regulation might make a grain of sense.
Here’s the bottom line: “Alternative” energy sources will be abundant on the very day that they are the cheapest form of energy that you can buy.
I worked on a synfuels project in the ’80’s. It worked great – you could make fuel gas from low quality coal for about $14/MCF, plus it had to be moved from an area with no existing pipelines. The only problem was that you could buy natural gas for less than $2/MCF through existing pipelines. Anyone want to volunteer to have your heating bill multiplied by a factor of 7? That’s what I thought.
January 11th, 2012 at 15:29
Well, the cheap heat will help defray the astronomical cost of trucking in water when the natural gas fracking ruins all the wells.
Anyone feel like moving to Pennsylvania? That’s what I thought.
January 11th, 2012 at 17:01
Nobody wanted to move to Pennsylvania before the fracking started. A former employer of mine had facilities there and the groundwater quality was surprisingly bad. (A young plant engineer tried to fix the fecal coliform problem by pouring a case or two of Clorox into the well. Lemon-scented Clorox. The perfume lasted a long, long time.)
If they don’t want to use natural gas, they could always heat with coal. They have lots of that in PA. That and closed steel mills and potholes and unemployment. PA would probably have the same reputation as Michigan, but since NJ is next door, it always makes them look better. (Like standing next to a really fat person can make you look thinner.)
January 12th, 2012 at 09:37
Nobody wanted to move to Pennsylvania because the landscape was raped for decades in the name of ‘progress’–the same ‘progress’ that the right is now advocating for the rest of the nation. Drill, bably, drill! Mine, baby, mine! Frack, baby, frack!
In any case, that is a side issue. Your initial response was–typical for the right-leaning–a non-sequitur. There is no link between cellulose ethanol for motor fuel and whatever you were working on for stationary heating. One doesn’t burn natural gas in an automobile–although that’s possible, and one of the many ‘alternative energy’ fuel programs under investigation.
No, the plain fact is that the oil companies have decided it’s cheaper to pay whatever fines are levied than to develop any sort of bio-fuel infrastructure. They could have done something in the last five years, but chose not to. So be it. I won’t cry for them.
(As an aside, I still wonder why methanol is never part of this discussion. Wood alcohol is one of the least expensive things to produce, and doesn’t use potential food sources.)
January 12th, 2012 at 17:06
I like your ideas, Dennis. Especially the ones that go: ‘Let’s you and him create my utopia”. Fabulous thinking, you’re my kind of guy.
January 13th, 2012 at 10:58
?? Random comments apropos of nothing which has preceded them. You must be a Republican.
January 13th, 2012 at 13:02
Actually, my ideas are more along the line of, “Let’s you and him not destroy my utopia in order to create your own.”
January 13th, 2012 at 13:12
Actually, you hit on an important point, Dennis. Methanol is never part of the discussion because it doesn’t help politicians from crop-raising states hold on to their financial backing.
When consumers drive the energy market, the most efficient source will be used. When politicians drive it, the most corrupt avenue will prevail.