Your writer has had an interesting day.  I returned from the API provided trip to Washington D.C. yesterday evening. (I’ll get to that next week, it’s a lot to study, distill and cover.) Since Christmas morning I’ve nursed along a cracked tooth.  Now if you have an abscessed tooth, take folk’s advice and don’t fly.  Really, even with good meds, the airliner cabin air pressure changes matter to the sensitivity of the nerves. Then today my dental professional extracted the wounded tooth and emptied out the microorganisms.  Yup, I do have mixed feelings about microorganisms tonight.

Before I left, Sunday January 2nd, 2011, I found the eminent, admired and widely circulated Robert Rapier, author of the R-Squared blog had left a comment on a week ago Tuesday’s post, December 28, 2010 in the spam file. I marked Mr. Rapier as ‘Not Spam’ and replied in the wee hours of Monday morning.

The documentation in the comments of the Dec 28 post is instructive and worth a review, not so much by yours truly, but by all of you.  The main divergence between Mr. Rapier and myself is in seeing the ethanol matter as a whole or taken apart into various points.

But to get an early grasp of the situation, please keep in mind that Mr. Rapier and John Stossel were cited as examples of the breadth and depth of the disinformation and misinformation circulating about ethanol. Also, Mr. Rapier is as far as I can tell, is fully independent, while Mr. Stossel is in the employ of Fox News, owned by News Corp. controlled by Rupert Murdoch., the Australian news empire owner.  Murdoch also has managed to gain the ownership of the Wall Street Journal that has also gone on the offensive against ethanol.

Mr. Rapier saw the Dec. 28 piece as a sort of personal affront, while Stossel simply ignored the work. Both men remain ignorant of the full context here.  Thus in respect I have apologized to Mr. Rapier.  But Rapier is a public figure and should become accustomed to being a part of others thoughts.  It’s the last apology from here and it’s my sincere wish Mr. Rapier will not need apologies again.

The issue in play is the petroleum to ethanol ratio.  The sly wish to use energy metrics; the wise will choose the economic, i.e. monetary facts existent in today’s reality.  Over the course of the conversation, one can see how it goes.  The closing point is, when I returned the night of January 5th 2011, Rapier was back in the spam file and had lit off another round of conversation.

From your review of the whole, in context, I seek your opinions.  Rapier may have a smashing Internet success in progress, but some of you are even smarter. What you think matters, perhaps even more if others can be apprised of your thoughts.

One parting shot before I retire to nurse my wee wound.  Its not a blast at Rapier, rather this writer thinks that even with the sophistication, investment and effort leading to immensely powerful and efficient internal and external combustion, burning fuels is a blunt and primitive way to extract the energy.  We can do better, and simpler fuels, richer in hydrogen to carbon ratios are sound, viable alternatives to simply burning stuff up.

Have a great weekend to start off the New Year.



13 Comments so far

  1. Al Fin on January 7, 2011 5:13 AM

    Brian: Both you and RR offer high value information to your readers. There will always be areas of disagreement over dynamic issues of science, technology, and economics.

    It’s too easy on the impersonal internet medium to let technical disagreements become personal. Life’s too short for allowing long grudges to evolve, based on relatively simple misunderstandings and slightly offset viewpoints.

  2. Robert Rapier on January 7, 2011 10:20 AM

    “Mr. Rapier saw the Dec. 28 piece as a sort of personal affront…”

    No, that is your misunderstanding. What we have here is failure to communicate. Here again, you cite me as an example of putting forth ethanol misinformation and disinformation. I don’t take it as a personal affront, but I think it is important to get the facts out there on the ethanol issue. So I asked you – and your readers will have to tell me if this is an unreasonable request – to give me specific examples so we could discuss.

    You have refused to do so. It just strikes me as really odd that you would use someone as an example of misinformation and then refuse to discuss the specifics of what the misinformation is. I write a lot about ethanol. It is my objective to be factual and provide accurate information. So it seems to me that you have completely misunderstood the nature of my annoyance here. It isn’t because I, personally, feel under attack. It is because you refuse to define what it is that is wrong about my position.

    “The issue in play is the petroleum to ethanol ratio.”

    If that is what you believe the issue is, once again you are wrong. I am not discussing petroleum to ethanol ratio. I have not suggested that it takes a lot of petroleum to make ethanol. That is your misreading of what I have written, and thus you have taken a misunderstanding and argued against that. My argument is quite a bit more specific than that. You made a direct claim: “Comments like “So taxpayer-subsidized ethanol exports actually increase our oil dependence – at taxpayer expense.” is a falsehood, plain as day.” I have addressed that claim. I knew you misunderstood it when you started writing about the 1.4 ethanol to petroleum ratio, because I am not writing about energy balances here. In fact, I think part of your belief that I am promoting misinformation centers around this mistaken belief, which is why I felt it important for you to define positions of mine that you believe are wrong.

    Thus, to conclude I believe you have misconstrued various positions of mine, and as such have dismissed them as misinformation. My request for you to define those positions – which you consistently refused for some reason – could have done a lot to clarify your own misconceptions. Unfortunately, you simply chose more filibustering and less discussion of actual positions.

    For the record, following that exchange you did make several personal affronts by suggesting that I am dishonest and lack integrity. Don’t do that and there is nothing to apologize for. Further, for the record, I have also been invited to many of those API trips that you have taken and mention in this article. I have turned them all down for reasons of journalistic independence, otherwise we would have long ago met in person.


  3. Gail Tverberg on January 7, 2011 10:56 AM

    I know Robert fairly well, and can vouch for his integrity.

    Perhaps you can clarify what specifically you disagree with Robert on. Ethanol involves a lot of inputs besides petroleum. If you only look at the petroleum inputs, and are concerned about a petroleum shortage, ethanol looks like a great “petroleum extender”. But if you look at all of the other inputs as well (natural gas/coal, fresh water, pesticides, herbicides, soil erosion), it does not look like nearly as good a deal. This may be part of what Robert is talking about (although I have not followed this discussion).

    Also, since ethanol is not chemically equivalent to gasoline, it can only be mixed up to a relatively small percentage, before it starts damaging the vehicle, unless the vehicle is specially made to use a higher % blend. Because of these issues, the amount of ethanol the country can use “maxes out” at a fairly low level. It looks like we pretty much have reached it. Even though E-15 has been approved, it is hard to believe that many will actually use it, because of the higher cost than E-10, and also because E-15 is not very advantageous for service stations (extra cost, potential liability of selling to the wrong person).

    Do you have a personal interest in ethanol being a solution to our oil problems?

    If you want to take some of the discussion off-line, I believe both of

  4. C. Stevens on January 7, 2011 11:59 AM

    I read all three when Al Fin is included. He’s right. Also that’s a hell of a long comment trail, guys.

    BW’s points for 12/28 look to be lost on RR. I don’t think he read the post. BW’s link to RR is where RR uses ‘outright lies’ some days ahead of BW. A little blowback should be expected. Arguing ‘points isn’t going to get RR anywhere at the level of AF and BW. Those guys aged way past can’t see the forest for the trees long ago. Its why I read them.

    I also think BW suckered RR out. Ive read RR lash out over at the oil drum when his ego is tweeked. BWs comments have some red hot chili pepper lines.

    I get BW s point. The forest view plainly shows ethanol is a great deal and should expect to be beaten up like big oil. Ethanol has arrived I guess. I bet big oil is a little envious of ethanols political pull.

    RR is missing an opportunity. The AFs and BWs may not have the numbers RR has, but they have the respect. Nobody’s tweeking those egos with any success.

  5. Robert Rapier on January 7, 2011 12:35 PM

    “BW’s link to RR is where RR uses ‘outright lies’ some days ahead of BW. A little blowback should be expected.”

    Another person claiming the forest view who refuses to engage on details. The forest view is made up of the trees. Saying things like “the forest view plainly shows ethanol is a great deal….” is completely meaningless unless you know what the trees themselves say. After all, the details define the forest view.

    Further, you also don’t seem to get it. I don’t have a problem with “blow-back.” I encourage that, and in fact did so in the linked essay. But I expect that blow-back to have some substance. In this case, the blow-back was “RR is wrong about ethanol.” OK, that’s fine for a starting point. Now, what am I wrong about? What is my position on ethanol after all, and where exactly is it wrong?

    Failure to engage on any of these points doesn’t further the conversation. Trying to claim the high ground by suggesting you really get the bigger picture doesn’t further the conversation. The big picture is made of lots of little pictures. I still say that a lot of this blow back is based on misinterpretations or ignorance of my actual positions.

    “Ive read RR lash out over at the oil drum when his ego is tweeked.”

    You have seen me lash out over personal attacks, which is where you saw me lash out at Brian. Perhaps you don’t understand the difference between matters of ego and matters involving personal attacks. If you believe I lashed out over the former and not the latter, then please link to an example. I think if you go back and review, you will see that cases of me lashing out are always the result of personal attacks. But I await your correction.


  6. Mitch on January 7, 2011 1:19 PM

    Wow, westenhaus, fin, rapier and tverberg all on the same page. When ya ever gonna see that? I’m with westenhaus, follow the money, see the big picture, the gold rules, common sense. Seems rapier is upset about something, I can’t put a finger on it though, he’s all over the place. I want to complain. Westenhaus doesn’t put up near enough about what he thinks about markets, finance and the economy. All that research stuff is great but how am I supposed to plug it in? This blog doesn’t add it up often enough. Sometimes you have to wait weeks for an opinion or an overview and some stuff never gets that far. I’m waiting.

  7. J.P. Katigbak on January 7, 2011 7:03 PM

    When some people look at the opinion of someone else, they never settle for a big question they do not answer to that very well.

    Unfortunately, they are really confusing with those views from both the left and the right (of the political spectrum), without acknowledging the true extent – and the viability – of both energy and transportation sectors the world over.

    It is something less actionable to speak about what is politically correct and what is not when someone is favoring the former’s viewpoint which I find it confusing and far from reality.

    Both sides of the political spectrum, in the US and other parts of the world, have still never learned from the mistakes of the past in their points of view about the true importance of economic and social progress.

    We, ordinary people around the world, need to realize the aspects of what economic growth and accompanying social progress would bring.

    That would need to think twice on various issues affecting the international economy (and various societies). There is no turning back in taking action on such issues.

  8. Brian Westenhaus on January 7, 2011 9:36 PM

    Hello Everyone!

    In order, please refer to the above comments as you need. I have limited time today.

    Hi AL! Good to see you here. There won’t be any grudge, like you I’ve learned not to choose to spend my time on feelings that make me feel bad. I like Rapier, I was a feisty young guy years ago. I know just how he feels.

    Hi Mr. Rapier! I’ll save the best for the end.

    Hi Gail! You observations Wednesday morning were spot on. Having slept on this event I thought I’d use an analogy. An engineer or a team of engineers need to build a widget from the ground up examining, choosing and designing elements so the widget will work and be built to get the job done. Widgets being widgets will fail. The mechanic will have to examine the whole thing to determine which element failed so the repair or replacement gets it going again. The user wants the job done. When the widget fails the users will cuss the engineer and bug the mechanic to get it going again, wondering what the replaced or repaired element is going to cost. It’s just how civilization has to work.

    Having rescanned Mr. Rapier’s text one theme re-occurs often, the idea that exporting ethanol increases oil imports. On the face of it – it does. But the exported ethanol reduces the importers oil import. Oil and raw gasoline are world market priced. Ethanol makes everyone’s price lower world wide. Knowing how much the price is reduced is a worthwhile endeavor, counting the barrels is futile and pointless. It might drive a nationalist a bit crazy, but everyone’s budget is cheered up.

    From the short list of examples provided only rainwater and soil erosion are already priced in. It might take a quart or two of glyphosphate (Roundup) per acre per year. In the spring of 2010 bulk glyphosphate cost less than $15 a gallon. It’s priced in as well. Seed genetics have wiped pesticides practically off the market. Rain falls where it falls, if the supposition is to move it to a higher value location, well, how and who is going to capitalize and pay for that? If the supposition is the location should have a different crop, who decides? Some central planner or the market?

    Soil under corn fares far better than under soya. But soya is a direct to human food, in even higher demand than the corn. Is the suggestion people are to be malnourished no matter the price willing to be paid or soil to be used? Again, who decides, the central planner or the markets? If you watch the markets, you’ll soon learn that crop markets between corn, soy, wheat and cotton all compete for land use. It’s priced in and the pricing is unavoidable without resorting to central planning. The fact is soil owned by the farmer is usually treated with the greatest care, the Federal Government makes considerable resources available and the science is adopted incredibly fast. But investors usually don’t care, they’re in it for the rent, soil be damned. If you guys want to get after someone, get after lenders who finance non-operator farmland investments. That’s your enemy, in fact the enemy of everyone who wants to eat.

    I’ve repeatedly cautioned my visitors to buy flex-fuel equipped vehicles. They’re worth more than the cost. It’s good long term investing to have alternative choices. When the engine design is shifted to more E-85 efficiency the cost per mile can be lower than E-10. The manufacturers are slowly optimizing as technology making the needed engineering changes becomes more practical. U.S. pollution control standards make it more complex than Brazil where the standards are less stringent.

    Hello Stevens. I can’t with certainty determine your gender so I beg forgiveness to start. Your observation I “suckered RR out” is probably true. Well with a reread, I agree. It seems in hindsight I peppered Mr. Rapier pretty well. Your point and Ms. Tverberg’s first point about Mr. Rapier’s integrity stands, now. Mr. Rapier, once he’d learned how his site comment system works repaired his integrity with a bit of help that can be seen at 2:27am. I thought I gave Mr. Rapier plenty of openings and time in the integrity matter – he and we learned. It was amusing though.

    Hi Mitch! I understand your complaint; I feel the same way most of the time myself. I’m a careful sort, though. This isn’t an investment page and my attorneys pounced on me within the first days, years ago, of where the lines are. What I can give you is this. Check what I said earlier this week about big oil, Tuesday I think. One could plan for a major ethanol market push with one or two developments, one being some, perhaps 1 to maybe 10 or more research breakthroughs in the ethanol fuel cell field, depending on what the research shows and who it turns out backed the research. The other is to watch aquaculture. I’m quite uncertain about the cellulosic side from the grasses and fast growing trees. Aquaculture could crush both the corn and grass markets for ethanol in a very short time as the yields per area are just stunning making the attractiveness practically irresistible. Whether or not a direct ethanol fuel cell is ready, profitable ethanol at under 75% of the book value of oil reserves will see capital move in an industrial commercial scale way. I can’t say, suggest or recommend who that might be.

    Just to put a point on it, this isn’t an investment blog, I’m not registered with the SEC nor ever will be. I started this blog to journal for myself and to share with others what I see and learn. The reason is to play a part in ensuring my children and grandchildren enjoy a better opportunity and standard of living than my forebearers and I. The hoped for result is accomplish the same for visitors and their kids as I seek to do for mine. We’re all more likely to make progress if there are lots of us than just one or a few.

    Hello again Mr. Rapier. Now that you’ve chosen to have us on a first name basis is it Robert or Bob? I prefer Robert for now. Ready?

    You win. There, feel better? In retrospect there is a truth to be found that I suckered you in and I admit it. But the fact is it turned out to be exploitation. I can’t take credit for that being by design, it just worked out that way. This event has offered a running commentary on choices, the minutia or the whole, and I have let it run, pretty much on its own. You are a public figure, made the opening from a stimulant by a reader on your site and charged through it.

    Back up at Ms. Tverberg’s response there is an analogy. You are a fine engineer and seem to go at things like a fine engineer should. But here we are investors and consumers with a deep slant towards the welfare of our families and friends. Al Fin is even further a field with a concern for the whole of humanity. We are in different leagues, if you will, not any better or more important than the other, they are all necessary. We see the same things but look at them seeing something without a similar description.

    Whether it’s the elements in the analogy, the trees in the forest or the points you seek to argue and debate, they are of such small relevance here I can’t be dragged into the exchange. Such an exercise doesn’t answer questions or help get to the goals.

    The questions are about what the future might hold. The goal is to make a better future for our loved ones and us. I’ll bet that applies to you, too.

    Divining that puzzle of the future is a dynamic, endless effort. Humanity is at a point where coal, oil, gas and nuclear are not going to be enough without very dramatic new puzzle pieces. Making it work for my loved ones is really important to me. It may well take decade or a century. The opportunities and risks are huge. I suppose all this hyperbole and rhetoric sounds strange to you, but it goose bumps the skin and stands up some hair around here sometimes.

    I can’t profess to have any idea how this might be of benefit for you. You might ask an objective loved one or friend to look it all over and kick it around.

    I know how you feel, I’ve felt the same way, suckered and exploited, more than once if truth be told. I did learn to sleep on things, don’t do things suddenly and wonder if in a week what I’m doing will seem silly. I guess that’s the best I can offer.


  9. Gail Tverberg on January 7, 2011 10:37 PM


    What I hear you saying is that you see corn ethanol as a step in the right direction. Fossil fuels and uranium won’t be enough, so we need something else. As with your widget example, corn ethanol is not the ideal substitute. But you see it as a reasonable step along the way. Even now there are some benefits–for example, E-85 cars that might provide transportation for you, if gasoline is in short supply.

    There may be some other benefits that you see. Before corn ethanol, the price of corn was lower, and I expect the price of land was lower (but haven’t checked). So from your point of view, corn ethanol has been helpful.

    I expect from an engineer’s point of view, these contributions are pretty small, but each of us looks at things from a different perspective. I guess I would tend to look at things more like Robert, and ask questions about whether the ethanol provides much real benefit beyond the fossil fuels that go into it. I would also ask questions about the sustainability of the whole process–isn’t there a significant risk that corn ethanol production (or whatever follows corn ethanol) will decrease greatly, just at the time oil or natural gas supplies decrease, because of some interruption in the whole process–lack of hybrid seed, or lack of diesel for tractors, or lack of fertilizer, or lack of propane for drying a wet corn crop? Our government does not seem to be good at optimal allocation of available supplies, and it is not clear markets will put farmers first.

    Each of us sees things from a different perspective. None of us knows all of the angles. But hopefully we can learn from each other.


  10. Gavin on January 8, 2011 1:32 PM

    One has to smile at the hypocrisy — or maybe self-delusion would be a more accurate description for the hyper-sensitive Mr. Rapier. He refuses API-organized trips because of his ‘journalistic independence’, but that same ‘journalistic independence’ does not stop him drawing a salary from a bio-business. Sigh!

    On substance, you may be wrong, BW, about nuclear ‘not going to be enough’. Back of the envelope, nuclear with breeder reactors, uranium extraction from seawater, and thorium could probably support a 100 TeraWatt world for about a couple of millenia. That’s enough power to support manufacturing liquid hydrocarbon transportation fuels from various sources and keeping an entire expanded global population at First World standards.

    Whether that would be the optimum approach is a whole other question — one which definitely needs economic analysis. But all-out nuclear certainly beats sustainably freezing in the dark.

  11. Robert Rapier on January 8, 2011 1:45 PM

    “One has to smile at the hypocrisy — or maybe self-delusion would be a more accurate description for the hyper-sensitive Mr. Rapier.”

    When someone calls you a liar and says you have no integrity, let’s see how sensitive you are, Gavin.

    “He refuses API-organized trips because of his ‘journalistic independence’, but that same ‘journalistic independence’ does not stop him drawing a salary from a bio-business. Sigh!”

    That doesn’t even make any sense. I currently work for a renewable energy company. In the past I worked for an oil company — in fact I worked at the Billings Refinery that Brian visited.

    I write about the things I want to write about, and I don’t go on API-sponsored trips because 1). Even if I accept their spin of events and attempt to report on them, people will just say “yeah, but you would say that because the API paid for it”, and 2). I don’t want to feel beholden in any way to the API. That isn’t to suggest that I disagree with the API on all the issues; I think they are right about a lot of things.

    “Seems rapier is upset about something, I can’t put a finger on it though, he’s all over the place.”

    Mitch, if you go read the comments in the previous post, I think you will understand. The issue is very simple. I was used as an example of ethanol misinformation. I made a simple request: “Could you please give examples?” I was not upset, nor did I take it as a personal affront — until my honesty and integrity were questioned. I was merely trying to have a conversation about ethanol policy, and I was never told what exactly it is that I am wrong about. It went like this:

    Brian: RR is misinformed about ethanol.

    RR: What exactly am I misinformed about?

    Brian: The big picture.

    RR: OK, but what about it? Can you give me specific examples?

    Brian: No, I have a forest view. I am not going to be drawn into your tree view.

    The whole thing was rather silly from my view. My objective was to discuss ethanol, and if I am wrong, where exactly that is. One person after another has said “Brian, I support your forest view” yet none of them have identified specifics about where I am wrong. The one person who tried has my position completely wrong — which I believe is the root of the issue.


  12. Brian Westenhaus on January 8, 2011 2:23 PM

    No personally identifiable info such as a full name unless you have chosen to be a public figure. Both for personal security and because my lawyers raise hell about it – and nobody here can compare to that!

    So, Please? Please, please?


  13. J.P. Katigbak on January 9, 2011 7:50 AM

    Perhaps some people need an honest proof about the need for recognizing the true usage of biofuels in both energy and transportation sectors. It’s time to roll up their sleeves and see for themselves.

    Thank you very much.

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