Tuesday, March 19, 2013

Regulations Require Use of Biofuel That Doesn't Exist

Patrick McMahon emails to follow up on my post, The Bizarre Government Regulations that May Send Gasoline Prices Through the Roof:
What is really crazy is that the law caps the amount of ethanol allowed at around 15 billion gallons. Of course our leaders know the proper amount to blend.

As you point out, the law requires refiners to blend advanced cellulosic biofuels , despite the fact that they are not being commercially produced.

Up until this year, the requirement has been relatively minimal ~500 million gallons, but by 2017 the amount reaches 5 billion gallons. The US produces about 3 – 3.5 billion bushels of soybeans annually.  A bushel of beans yields 11lbs of oil, and a gallon of biodiesel weighs ~7.3 lbs. Therefore even if we devoted all of the soybeans produced (3.015 bb) in the 2012/13 season it would only amount to 4.5 billion gallons. Where is all this biofuel going to come from?

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