Passage of the federal energy bill with its boost for the ethanol industry has renewed fire from critics who say ethanol doesn't deliver a net energy gain, is driving up prices for food and livestock feed, and will not lead to energy independence.

But ethanol's backers say ethanol now yields much more energy than is required to produce it. They say enough corn can be grown to meet the requirements of the energy bill and that, in any case, cellulosic ethanol made from wood and grasses is the wave of the future.

They say the five-fold increase in ethanol production required by 2022, combined with greater vehicle fuel-efficiency mandates, will indeed reduce U.S. dependence on foreign oil.

Currently, about 7.5 billion gallons of ethanol are being produced each year. The energy bill requires production to jump to 36 billion gallons by 2022. Of that amount, 15 billion gallons must come from corn, and 21 billion must come from cellulosic sources, such as wood chips, grasses and paper waste.

Energy gain or loss?

Perry Rahn, professor emeritus of geology at South Dakota School of Mines & Technology, is one of those who question whether ethanol provides a net energy gain.

In a 2005 paper, Rahn said 7.5 billion gallons of ethanol - roughly the amount now being produced per year - reduces demand for petroleum by only 5.6 percent.

Rahn cites the work of Cornell University professor David Pimentel, who argues that it takes more energy to produce ethanol than it yields. Pimentel said pro-ethanol scientists omit the energy costs of manufacturing farm machinery and processing equipment needed to make ethanol, according to a copyrighted article on EVworld.com, a Web site that advocates for electric and hybrid cars.

Critics such as Rahn and Pimentel say heavy fertilization and irrigation for corn also add energy costs.

Pimentel calculates that it takes 25,000 kilocalories to produce one gallon of ethanol, which yields 19,400 kilocalories.

Rahn said even if ethanol shows a slight net energy gain, it won't eliminate U.S. dependence on foreign oil.

Rahn suggests growth is the primary energy culprit. He says reducing consumption is the best way out of the energy crunch. "We keep building out in suburbs that require more gasoline and bigger cars. It's got to come to an end," Rahn said. "Ethanol is just not going to do it."

But Brian Jennings, executive vice president of the American Coalition for Ethanol, said the net energy loss is an old and flawed criticism of ethanol, even corn-based ethanol. Jennings, of Sioux Falls, said the energy-loss argument was probably correct when the first plants began making ethanol in the late 1970s.

Now, the most recent U.S. Department of Agriculture figures show that ethanol contains 77 percent more energy than the energy spent to make it, Jennings said.

Randy Kramer, president of KL Process Design Group of Rapid City, says his firm's corn-ethanol plant at Sutherland, Neb., is efficient, using 15,700 British Thermal Units of steam energy to make one gallon of ethanol. The gallon of ethanol yields 80,000 Btu, Kramer said.

Jennings said the net energy argument breaks down further when compared with gasoline, which requires more energy to produce than even corn ethanol. "You can't take a barrel of crude and stick it in your fuel tank and run your car," Jennings said. "Energy must be transformed to make it usable."

Fuel vs. food Critics such as Rahn also say the increased production of corn-based ethanol has taken corn out of the food chain, driving up corn and food prices and putting pressure on consumers and livestock feeders.

About 3 billion bushels of this year's record 13-billion-bushel corn crop went to make ethanol.

"Here is the wonderful food basket of the world," Rahn said. "We're filling up our gas tanks with it when there's millions of people starving to death."

Jennings agrees that the increased price of corn is one factor in higher food prices. But he said rising energy costs are the biggest factor driving food prices. "There's very little corn value in a box of cereal," Jennings said. Oil at $90 to $100 a barrel makes it more expensive to plant and harvest crops and transport them to the processing plants, he said.

Fuel vs. livestock feed

With higher demand and prices for corn to feed ethanol plants, the cost has also gone up for corn to feed livestock.

Scott Jones of Midland, president of the South Dakota Cattlemen's Association, said some association members have concerns about the energy bill's requirement for more corn-based ethanol, although the organization has not taken an official position on the bill's higher renewable-fuels standard.

"Livestock producers in all segments of the industry are now entering into a new era, where they will see increased volatility and much higher prices for livestock feed," Jones said.

But because of increased requirements for ethanol, drought will play an even bigger role in feed costs in the future, Jones said.

Even so, the association supports development of renewable fuels as a way to lessen dependence on foreign oil, Jones said.

Jennings admits that higher corn prices are driving up livestock feed costs. He said those will be offset somewhat by the availability of an ethanol byproduct, dry distillers grain, which has a higher protein content than corn.

Jennings predicts that the cattle industry will be better able to weather the increased corn cost than poultry and swine producers.

He said the energy bill caps corn-based ethanol production at 15 billion gallons in 2022. Based on current production capabilities, that amount would require about 5.3 billion bushels of corn, he said.

Jennings said more farmers are planting corn instead of other crops. A record 93 million acres were planted this year nationwide.

Even in western South Dakota, where corn plays a smaller role, more farmers will grow it if they have an incentive, said Dale Barker, president of ProEco, a company planning to build an ethanol plant in Belle Fourche.

"I never underestimate the American farmer," Barker said. "If there's a demand for corn, more people will plant corn."

Grass to gas Still, that 15 billion gallons is probably the upper limit for corn-based ethanol, said Mike Held, administrative director of the South Dakota Farmers Union.

At that point, the country will have to start moving toward biomass such as grasses and wood chips to produce ethanol, Held said. "Hopefully, that will provide some opportunities for the western two-thirds of the state."

The farm bill, still to be hammered into final form in Congress next month, allocates money for research into using grasses to produce ethanol. The research is being coordinated by South Dakota State University.

Jones, who ranches near Midland, is skeptical about the financial feasibility of growing biomass in this region. "I can't believe that switchgrass can be grown on a year-after-year basis that's economically sustainable," he said.

Even if the West River prairies could grow biomass for energy, it would take land out of crop and livestock-forage production, Jones said. "It would place tremendous challenges in front of livestock producers," Jones said.

KL Process Design's Kramer and his partner, engineer Dave Litzen, also are skeptical about the financial feasibility of switchgrass for ethanol, at least in western South Dakota. "Switchgrass is going to be very difficult from a cost perspective to bring to a plant," he said.

Fuel from wood waste

Kramer and Litzen hope to build smaller wood-to-ethanol plants next to sawmills, paper mills and urban landfills, with their stocks of yard waste.

They agree corn has limits for producing ethanol.

"Corn will get you partway there," Litzen said. "The rest will have to come from other feedstocks."

They say the energy bill's requirement for 21 billion gallons of cellulosic ethanol by 2022 is attainable.

They cite a 2004 study by Oak Ridge National Laboratory that shows 1.3 billion tons of cellulosic material is available each year from agricultural, forest and municipal wastes.

"Ethanol will account for 30 percent of liquid fuel energy needs in 2022," Litzen said. "That, combined with the (higher vehicle gas mileage) standards, will at least get us to energy independence."

Already, KL Process is delivering all-American-made fuel at one Rapid City gas station, Canyon Lake Gas & Auto Care. The gasoline is refined from Wyoming oil and mixed with ethanol from the firm's Nebraska plant.

"We're fed up with being tied to overseas oil fields," Kramer said. A retired Army officer, Kramer fought in Iraqi oil fields in Desert Storm. Litzen worked for years for Shell Oil, which produced oil in Iraq.

"Now, we're bringing that back to not only transition from oil to bio-renewable fuel," Kramer said, "but also transitioning from corn to a waste material, sawdust, right here in the Black Hills."

Contact Steve Miller at 394-8417 or steve.miller@rapidcityjournal.com