Posted on October 20, 2008 by Tia Lalani

Neil Hepburn’s faculty colloquia on Bio-Fuels and Food Prices will be on October 27, 2008.

by Dylan McConnell

I recently sat down with Augustana Economics Professor Neil Hepburn, to discuss his upcoming colloquia on bio-fuel and its unfortunate correlation to rising food prices.

Bio diesel, a fuel which can be used in most diesel engines, was originally thought to be an ideal way of cutting down the international need for oil, but according to Hepburn, it hasn’t panned out that way. Apparently, the process in which canola, corn, soy and other oil-based crops is harvested and converted into usable oil is ineffective, too expensive and a waste to crops that could otherwise be used as food.

Currently, bio diesel is a mixture of between 2-20% fuel from oil-based crops, and the rest comes from conventional fossil fuels. While every little bit helps in the cause to cut down the emission of greenhouse gases, the amount of food needed for this relatively small fraction of fuel is too much to be considered efficient.

This efficiency, aside from being impractical, has led to a steady increase in the prices of food. Because so much agricultural land – that would otherwise be used for growing food – is now dedicated to the production of bio-fuel, the supply of food has diminished. Meanwhile, the cost for farmers to harvest those crops continues to go up as well, largely because of the lack of a better, cheaper option to the fuel needed to operate their tractors, harvesters and other equipment.

The reason there is no cheaper option to current fuel is that bio-fuel is also quite expensive to produce. In fact, if it wasn’t for government subsidies, the project would most certainly fail entirely.

Professor Hepburn says that beyond bio-fuel, there are other ways to create a more environmentally friendly oil. One is to blend ethanol with standard gasoline, a tactic that Mohawk gas stations have offered for some time. However, ethanol is once again extracted from food crops like wheat and barley, and only the grains are useful – the stalks are wasted. Sugar cane is a better option in the farming of ethanol, because the entire plant can be used, but again, because ethanol has to be blended with regular gasoline, the benefits of this option are minimal.

One more agreeable option that Professor Hepburn will speak on is the farming of algae for oil. It is more efficient and environmentally-friendly than the other options, and if subsidies were taken away from the current production of oil-based food crops for bio-fuel, algae farming could be economically viable sometime soon.

Professor Hepburn’s presentation will delve deeper into the economics of these alternative options to fossil fuels, and better explain just how these methods work.

If you are interested in learning more, be sure to head down to C014 on Monday, October 27 at 12:30.

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