The Oil Drum

Thanks to TOD reader Tim R. for pointing out this piece on the food v. fuel problem in the Seattle PI yesterday. One takeaway message (but is it a valid one?) is contained in this chart from a group at The University of Washington (click to enlarge):

UNDER THE FOLD, you will find two youtube videos that are worth your time. The first is from Fast Money (CNBC) yesterday entitled "It's Supply, Stupid." After a bit of discussion on the panel, Joe Terranova provides a really nice discussion (about 4 mins) of the reasoning behind why the price oil is rising: supply and demand. Sure, it's a little bit the weak dollar, it's a little bit speculation, but Terranova makes an elegant argument as to why it's mostly the fundamentals--which is kinda what we've been saying for a while around here, eh?

The second video, is Jim Cramer of CNBC's Mad Money (1:30) discussing ethanol and its implications for food; he uses the words "Wall of Ethanol Truth," "that issue is killing Americans," "ending the ethanol mandate," and "Malthusian." Wow. Let's discuss.

Not too long ago, I nearly quit writing, because I was losing control of my free time. I came to a compromise solution that has worked out well for me: I have continued to write, but I have reduced time dedicated to debates, correspondence, and addressing questions or criticisms about my essays. It is now apparent that it was not the writing, but instead the peripheral stuff that was really eating up all my time.

However, as a result of the change, some comments and questions that are directed at me go unanswered. Sometimes someone will make a criticism or comment that I would like to address, but I know it will lead to several more responses. In order to "catch up" with some of this without once again getting involved in protracted exchanges, on my way out of town for a business trip I put up a brief post inviting readers to ask questions or make comments. I hadn't originally intended to post it here, but there were quite a few topics that have been discussed at length here at TOD. So, I went through, picked out some of the questions, and took a stab at answering them.

There are questions on biobutanol, gasoline inventories, refinery margins, debunking, ethanol, investing, the future of the oil industry, where to live to ride out Peak Oil, and whether I have now lost hope. I sometimes excerpted the questions, but I linked to the originals so you can see them in complete context.

The following is a guest post by John Benemann. John has many years of expertise in biomass conversion, and previously co-wrote a guest piece on cellulosic ethanol. On the subject of biodiesel from algae, he literally wrote the book.

I originally wrote an article over a year ago in which I mentioned the potential of algal biodiesel. I still believe, as I did then, that biodiesel (or more broadly, renewable diesel) is a far superior fuel to ethanol for reasons I outlined in that essay. However, over the past year, the more I learned about the prospects of biodiesel from algae, the more it started to look to me like cellulosic ethanol: Technically feasible? Yes. Commercially feasible? Nowhere close, and the prospects don't look good any time soon. (However, as in the case of cellulosic ethanol, I believe the technology has some potential, so the government should fund the research).

This was a bit disheartening for me, because I had high hopes that we had an option for replacing a large amount of our fossil fuel usage. I no longer believe that, and recent work by Krassen Dimitrov (PDF warning) had reinforced my doubts. When I read the guest post by fireangel, "Has the Algae Cavalry Arrived", my first thought was "Nice work." My second thought was, "I should have jumped on this and investigated thoroughly eight months ago when those nagging doubts started to creep in." One nagging question I have had since I first read about biodiesel from algae is "Why would NREL terminate the project if the prospects really were good?"

But should there be any further doubts, here is a guest post from a man who knows as much about this subject as anyone else in the world. And he bears bad news for those who had visions of driving around in algae-fueled transportation.