Ethanol - Too Much of a Good Thing?

As Wisconsinites, we appreciate things like bratwurst, cheese, the Green Bay Packers and yes, beer. There are times that we overindulge in any of these favorites and it becomes either annoying or unproductive to those who either take part or are there to witness.

Wisconsin farmers and other investors have fallen in love with a new Midwest fad - ethanol plants. There are presently 114 operating ethanol distilleries in the United States, including seven in Wisconsin and two within 40 miles of Eau Claire. There has been talk that negotiations are under way to develop at least one more ethanol plant in the Chippewa Valley sometime soon.

The benefit of ethanol plants is obvious. Jobs are created, farmers are able to sell their corn for a higher price and rural economies experience growth. But there are another 80 facilities under construction and seven other existing complexes that are already planning to expand.

Consequently, ethanol production has been escalating at a pace that should be a warning to those who are considering an investment in alternative fuels. In January alone, ethanol production increased five percent to 5.9 billion gallons compared to 5.6 billion gallons produced in 2006. Unfortunately, the price forecast for ethanol has been falling for the past year and, as supplies increase, ethanol producers will likely have to cut prices to compete with gasoline.

The problem with technology is that new industries can change within just a few years. There are many studies taking place worldwide where other energy-yielding crops other than corn, such as sugar, are being processed to produce ethanol. Who is to say that corn-based ethanol will not become the third or fourth best energy option in the next decade?

From an environmental standpoint, one would have to be blind to the fact that our world should become less reliant on fossil fuels. One of the negatives about ethanol plants, though, is that a foul odor can be emitted. In a recent report in the Wall Street Journal, one expert likened the smell to that of stale Miller Lite beer. Like I said, it is never good to overindulge