E85 Boondoggle Of The Day: GM Still Tilting At Biofuels

GM is spending about $100 million a year adding flex-fuel capability to our vehicles. We can’t afford to leave this capital stranded… I think it would be very helpful if we could get government assistance. But I really want the oil industry, I want the people who are at this conference, I want the government and I want us to just work together to make ethanol a reality,

This was the message the GM’s Tom Stephens took to the Renewable Fuels Association’s National Ethanol Conference in Orlando. And though Stephens’ exhortation of the ethanol industry makes for a pleasant addition to GM’s typical ethanol message (i.e. the first sentence of the quote), it’s little more than filler. GM’s push to align itself with the ethanol industry continues unabated, as Stephens reveals that half of all GM vehicles will be flex-fuel capable by 2012. The problem is that GM reckons the country needs another 10k E85 pumps (up from the current 2k), and since the ethanol industry would effectively collapse without government support, nobody from the industry is jumping in to take responsibility for this self-serving infrastructure project.

Today’s there’s 2,200 (ethanol fuel stations) that are out there but that’s not enough. Two-thirds of the pumps are concentrated in 10 states and those 10 states have only about 19 percent of the flex-fuel vehicles that we have on the road. That’s a big problem for us.

Though Stephens can quantify the problem, and hope that the industry will fix it, he’s whistling in the wind. Even with government blending mandates and tax credits, few localities have any interest in expanding ethanol’s availability, in no small part due to its highly questionable environmental benefits (in the current corn-based form). In fact, the Southern California Association of Governments recently turned down $11m in federal grants aimed at expanding ethanol pump availability. Why? As one representative put it:

If we could prevent forest fires that’s a good thing. However, preventing forest fires by cutting down every tree in the forest might not be the way to accomplish that… You have to consider carbon emissions in your land use, you have to consider everything. That is something that has not been done by the boosters of ethanol.

Local companies confirm that without the federal grants, the pumps will not be built. If production, blending and infrastructure construction must be paid for by the government to make ethanol a viable gasoline alternative, well, how viable is it really? The irony in all this: corn use in ethanol production is actually increasing, and thanks to the new Renewable Fuel Standard proposed rules, it likely will continue to. And all because political convenience is a far more persuasive argument in Washington than mere science.

The fact that GM remains so whole-heartedly in favor of this country’s continued flirtation with the welfare queen of alternative energy will not help wash the “Government Motors” label off anytime soon.