I did some research today and found a few very interesting things. We could well be in for more rough times.

As many of you know, Obama is attempting to shut down all off shore deep water drilling. A ban on production in the Gulf of Mexico is the next logical step. The "good" news is that the current depression has reduced energy consumption, so prices have not yet spiked as a result.

In 1979 I was just out of the Navy and working in a traveling job that required me to drive all over the East. I had to go from Washington DC, to Pittsburgh, to Boston quite often to provide training. This was the year that the Iran-Iraq war broke out and shut down Iranian oil production. Jimmy Carter was President. The war resulted in a deficit in US oil needs of only 3%. See http://www.cbo.gov/doc.cfm?index=5210&type=0

The result was huge gas shortages where cars ran out of gas waiting in lines at the gas stations. Even & odd day gas rationing was dictated. I ended up stuck on the Turnpike waiting for midnight so I could gas up and continue my trip. Prices spiked and price controls were not lifted until the crisis had past. At the time US oil prices were limited to $6 a barrel with the world market at $30. Once the price controls were lifted the government instituted a "Wind Falls Profit Tax". This removed any incentive to increase domestic production.

Much is made about how Ethanol production can never replace oil. This is based on using corn as the only feedstock for ethanol production. The argument is also made that fuel should not be made from food and that the increase in Ethanol production resulted in the recent spike in food prices. All of this is disinformation. Lots of non-food sources can be used to make alcohol, but lets stick to corn for the moment. The recent spike in food prices was caused by the plumit in the value of the dollar. The spike in oil prices is much the same, along with speculators running the price up, nothing more.

In the USA, very little corn is actually eaten as corn. Check http://fatknowledge.blogspot.com/2008/0 ... ption.html
and you'll see that less than 2% of corn in the USA is eaten in a form that you'd think of as corn! The largest use is as feed for cattle. 3% is used for high fructose corn syrup, and most will agree we shouldn't eat that at all.

Lets take the feed used for cattle. Cattle are supposed to eat grasses and shrubs, not corn. Cows have a hard time digesting starches. Most of the vet bills for cows are related to feeding them the wrong food. Many studies have been done on feeding cattle distillers grain vs. corn. Distillers grain is what is left over once corn or other grains have been used to produce alcohol. Here is the interesting thing. If you take a bushel of corn, you can produce 2.4 gallons of ethanol from it. If you feed cattle on what is left over, they will gain more weight and be healthier than if you fed them that same bushel of corn!

If we took the corn used for cows and made alcohol from it first, it would be enough to provide 10% of our current gasoline needs. Mixed with Gasoline at 10% no changes to your car are needed. If a 3% drop in oil supplies created the 1979 energy crisis, think what an increase in 10% would do, especially when it costs virtually nothing to do. Struggling farmers would get their feed for free by selling the alcohol at $2 a gallon.

I just don't see why this idea isn't being used. I have a flex fuel vehicle that can run on pure alcohol. The problem is that here in NY I can't buy E85 fuel unless I want to drive over 50 miles to get it. Go figure.

As for other sources of ethanol, just about anything that produces starch can be used. Cattails are one of the more exciting ones. These can be grown in sewerage effluents and will clean the water before going back to the river. They produce far more starch per acre than grain crops or potatoes. They require no pesticides or tilling. Just planting the wetlands that exist between the lanes of the interstates would provide about 25% of the domestic energy needs. There are huge areas that can be exploited for energy with no negative environmental impact, yet we do nothing.