Biofuels False Promise: Breakthroughs May be Tougher Than Previously Thought, written by Dave Cohen … In the August issue of Scientific American, David Beillo published an article called "The False Promise Of Biofuels." I have a paper copy, but not an electronic copy, so I won't be quoting it extensively. Here's the summary, which is good enough for our purposes. Despite extensive research, biofuels are still not commercially competitive. The breakthroughs needed, revealed by recent science, may be tougher to realize than previously thought. Corn ethanol is widely produced because of subsidies, and it diverts massive tracts of farmland needed for food. Converting the cellulose in cornstalks, grasses and trees into biofuels is proving difficult and expensive. Algae that produce oils have not been grown at scale. And more advanced genetics are needed to successfully engineer synthetic micro-organisms that excrete hydrocarbons. Some start-up companies are abandoning biofuels and are instead using the same processes to make higher-margin chemicals for products such as plastics or cosmetics. – OilPrice/Dave Cohen
Dominant Social Theme: Natural power is the best power. And Green is cool.
Free-Market Analysis: This article (excerpted above) provides us with a good postmortem of the foolish biofuels industry. We knew these boondoggles wouldn't work because they didn't work in the 1970s either, the last time the business cycle turned and gave us a big bull market in metals.
Nothing much changes from decade to decade within the context of the power elite's dominant social themes. The same memes are trotted out over and over when fiat-money stimulation fails. When nations slide into recession and depression, the Anglosphere elites immediately propose additional fear-based promotions.
Starting in the early 2000s with the Bush administration, Americans heard once again that the world is running out of energy and that "conservation" is necessary. Peak Oil was the buzz word of the day. Rationing was suggested and "new" forms of energy foisted on the gullible public. The idea is to use elite dominant social themes to further discipline and regulate the larger society. Here's some more from the article.
40% of America's corn crop went towards ethanol production last year, which signals the end of this boondoggle. Arable land of course should be used to grow food, not fuel. … J. Craig Venter calculates that replacing all of our transportation fuel with corn ethanol would require a farm three times the size of the continental U.S. Ethanol from cellulosic feedstocks is just a flat out failure. You can do it, but the process is slow, expensive and thus will never scale unless some miraculous breakthrough is made.
… Obama's energy secretary Steve Chu threw all his replacing oil eggs into two baskets. His first strategy has been to throw a lot of R&D money at improving batteries for electric cars. Although there are now Chevy Volts on the road, the use of plug-in electrics vehicles (PHEVs) is still in infancy, and given the cost of these vehicles (especially the batteries), this industry may never grow up …There will likely be fewer than 1 million PHEVs on the road by 2020.
Chu's second strategy was to pour money into synthetic biology. Chu's idea … was to shoot a bunch of research arrows at a target, assuming the target exists, and hope you hit something, i.e. achieve a significant breakthrough which would allow us to produce relatively cheap fuels at large scales from genetically altered plants or microorganisms.
Needless to say … no such breakthrough has occurred … Obama chose Steve Chu because his science experiments were open-ended. It might takes years to achieve a breakthrough, or forever …Meanwhile, Americans are once again enduring the high fuel prices they saw before the "Great" Recession. Unless there's a global depression, those prices are going to remain high and go higher. Thank you Hopey-Changey! So what replaces oil? Why, more oil of course! This time the oil will come from "unconventional" sources like the Bakken or Eagle Ford shales. But that's a topic for another post.
It is all so predictable. Peak Oil, solar power, green energy … these are methodologies to control the masses. The idea is frighten people with scarcity memes and then offer globalist solutions that further reinforce Anglosphere elite control worldwide. It's all about control and realizing world-spanning elite ambitions. Conservation has very little to do with it.
While the upside fiat-money business cycle is very useful to the power-that-be, in some ways the down-side of the cycle is even more helpful. People feel uncertain and are apt to agree with the idea that there is simply "not enough to go around." This allows the elites the psychological latitude to introduce programs that involve such items as "Smart Meters" designed to track consumer's every-use of power from cradle-to-grave.
Take a step back and the pattern becomes obvious. Central banking economies are set up to fail and the anxiety of their failure provides fertile ground for further elite consolidation and control. We saw the same memes being trotted out in the 1970s, with the same effect. Not only do they aid in elite consolidation of power, they also tend to defuse the anger that people might otherwise take out on the system itself (where it properly belongs).
Throughout this long down-cycle, for a decade now (with much more to come) we've written articles on the fakery of Peak Oil, the silliness of alternative energy and the nonsense of various kinds of green investing and "conservation." We're not against conservation of course, just government mandated memes and the laws that result. If the market decides … fine. But the market has very little to do with these manipulations.
Today, solar and wind power are once again failing as we predicted. The silly, little electric cars that GM has spent so much money on won't ever catch on; the crisis of Peak Oil seems (surprise!) to have been suddenly defused by "fracking" and the discovery of numerous additional oil fields in the US and elsewhere.
The biofuel meme – and green power generally – was flogged incessantly in the 1970s. It wasn't successful then and it won't be successful now. It's already unravelling as it has so many times before. That's because it's a methodology of control not a valid economic trend. it's an elite promotion, not a free-market evolution.
There is plenty of oil in the world and the reason to promote biofuels has a lot more to do with the regimenting of society than relieving some nonexistent energy shortage. Hopefully, the failure of the current programs in the US and elsewhere will begin to awaken people to the green fraud that continues to be perpetuated. In aggregate these promotions will cost investors billions and in many cases leave them poorer but no wiser.