ORNL uses one-sided analysis to make flawed claims about land-use impacts of corn ethanol
Oak Ridge National Laboratory (ORNL) will soon release a study looking at use, production and exports of corn. Unfortunately, the authors have misinterpreted their detailed look at the supply side of the corn market to make sweeping conclusions about the impacts of U.S. ethanol policy on land-use change. Even a high school economics student knows there are two sides to every market—supply and demand. By totally ignoring the demand side of the market for corn and what demand would have been without U.S. ethanol policies, the ORNL analysis ends up being nothing more than a pretty picture of where the supply of corn went.
The study (which is currently only available as power point slides) was prepared at the request of presented to the California Air Resources Board (ARB) to help inform its low-carbon fuel standard and has already been seized upon by the corn ethanol industry to argue that California should call off its efforts to account for carbon emissions from deforestation that results from the production of biofuels—commonly referred to as indirect land use change or “ILUC”—when assessing the lifecycle emissions impacts of different biofuels. The corn ethanol lobby group Growth Energy went so far as to say that the report “puts a stake through the heart of the whole [ILUC] scheme".
[For a quick refresher on the market-driven process that results in ILUC and why a rigorous, science-based accounting of ILUC emissions matters if we are to meet our climate challenges with smart energy policies, see this great video]
This type of hyperbole is not surprising at a time of waning political and public support for corn ethanol, but a closer look at the ORNL analysis quickly reveals the limitations of its conclusions.
The most immediate flaw in the ORNL analysis is that the authors make no attempt to compare what happened in crops and land over the last decade to some informed baseline scenario—in other words, what could, would or might have happened in the market without the US biofuels polices. After all, how can you say what a policy did unless you have some sense of what the world would have looked like without the policy? In particular, the authors of the ORNL analysis makes no reference whatsoever to global demand for corn or other commodity crops like soybeans, or how prices in those markets were affected by corn ethanol mandates and tax incentives.
Instead, the authors go to great lengths to describe the historical data, telling us what happened on the supply side of the corn market over the period 2001-2008 when U.S. biofuels policies were in effect. However, this description doesn’t actually tell us anything about what U.S. corn exports would have been like had the policies not been in place to drive the rapid expansion of the ethanol industry and so tells us nothing about what the impacts of the policies actually are. Rather than a meaningful comparison of supply and demand with and without the policies, the study draws highly misleading conclusions based exclusively on supply and only with policies in effect. The study simply concludes that because U.S. corn exports didn’t decline from 2001 to 2008 and there wasn’t an acre for acre increase in planted area, no ILUC occurred.
Why is this problematic? Imagine you’re on an airplane flying towards a steep mountain. The nose of your plain is tilted up, but you look out the window and the mountain looks pretty steep. You can’t help but feel a bit nervous. The authors of the ORNL study would have you believe that you’re in the clear—all that matters is that you’re flying upwards. They say this with confidence, but you notice that they’re not even looking out the cockpit window to see how high the mountain is; all they’re doing is looking backwards out the rear window and saying: no worries, we’re going up! But just because you’re on an upward trajectory, doesn’t mean you’re going to avoid crashing into the side of the mountain. Indeed, it’s not enough to be going up; you actually have to be going up at a rate that’s fast enough to clear the mountain. Likewise, just because U.S. corn exports generally went up over the last decade, it doesn’t mean that those exports were sufficient to meet all global demand for corn.
These conclusions are hardly strong enough to put “a stake through the heart” of ILUC theory. The fact is, ILUC emissions are not trivial—on the contrary, the science has shown that ILUC emissions are the largest components of total emissions from conventional biofuels like corn ethanol and can sharply reduce or negate any climate benefits we hope to see from replacing fossil fuels with biofuels (see studies by Searchinger, Tyner, Hertel and the EPA). As a result, ignoring these emissions means promoting biofuels that actually increase carbon emissions relative to the gasoline they are meant to replace. So instead of reducing emissions, we simply shift our emissions from the carbon in fossil fuels to the carbon in our lands, risking our ability to address our climate challenges in time to prevent the worst impacts of climate change. ARB should ignore any hype created by those who offer a simplistic reading of the ORNL analysis for their own gain, follow the science on ILUC, and ensure that rigorous rules for lifecycle emissions accounting, including consideration of all direct and indirect lands impacts, is done for all biofuels in the California low-carbon fuels standard.