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New Technologies in Ethanol Production

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  • Rendleman, C. Matthew
  • Shapouri, Hosein

Abstract

Fuel ethanol production has increased steadily in the United States since the 1980s, when it was given impetus by the need to reduce energy dependence on foreign supplies. The momentum has continued as production costs have fallen, and as the U.S. Clean Air Act has specified a percentage of renewable fuels to be mixed with gasoline. The fraction of annual U.S. corn production used to make ethanol rose from around 1 percent in 1980 to around 20 percent in 2006, and ethanol output rose from 175 million gallons to about 5.0 billion gallons over the same period. New technologies that may further increase cost savings include coproduct development, such as recovery of high-value food supplements, and cellulosic conversion. High oil prices may spur the risk-taking needed to develop cellulose-to-ethanol production. Developments such as dry fractionation technology, now commercially viable, may alter the structure of the industry by giving the cheaper dry-grind method an edge over wet milling. Dry milling requires smaller plants, and local farmer cooperatives could flourish as a result. Though improvements in processing and technology are important, however, the fluctuating price of inputs such as corn, the cost of energy alternatives, and environmental developments play larger roles in the fortunes of the industry.

Suggested Citation

  • Rendleman, C. Matthew & Shapouri, Hosein, 2007. "New Technologies in Ethanol Production," Agricultural Economic Reports 308483, United States Department of Agriculture, Economic Research Service.
    • Handle: RePEc:ags:uerser:308483
    DOI: 10.22004/ag.econ.308483
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    References listed on IDEAS

    as
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    2. Torre Ugarte, Daniel de la & Walsh, Marie E. & Shapouri, Hosein & Slinsky, Stephen P., 2003. "The Economic Impacts of Bioenergy Crop Production on U.S. Crop Production," Agricultural Economic Reports 33997, United States Department of Agriculture, Economic Research Service.
    3. Kevin McNew & Duane Griffith, 2005. "Measuring the Impact of Ethanol Plants on Local Grain Prices," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 27(2), pages 164-180.
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    5. Gallagher, Paul W. & Johnson, Donald, 1999. "Some New Ethanol Technology: Cost Competition and Adoption Effects in the Petroleum Market," Staff General Research Papers Archive 5265, Iowa State University, Department of Economics.
    6. Tembo, Gelson & Epplin, Francis M. & Huhnke, Raymond L., 2003. "Integrative Investment Appraisal of a Lignocellulosic Biomass-to-Ethanol Industry," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 28(3), pages 1-23, December.
    7. Gallagher, Paul W. & Otto, Daniel & Dikeman, Mike, 2000. "Effects of an Oxygen Requirement for Fuel in Midwest Ethanol Markets and Local Economies," Staff General Research Papers Archive 5244, Iowa State University, Department of Economics.
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    Cited by:

    1. Hettinga, W.G. & Junginger, H.M. & Dekker, S.C. & Hoogwijk, M. & McAloon, A.J. & Hicks, K.B., 2009. "Understanding the reductions in US corn ethanol production costs: An experience curve approach," Energy Policy, Elsevier, vol. 37(1), pages 190-203, January.
    2. Li, Jun & Zhao, Renyong & Xu, Youjie & Wu, Xiaorong & Bean, Scott R. & Wang, Donghai, 2022. "Fuel ethanol production from starchy grain and other crops: An overview on feedstocks, affecting factors, and technical advances," Renewable Energy, Elsevier, vol. 188(C), pages 223-239.
    3. Jenkins, Timothy L. & Sutherland, John W., 2014. "A cost model for forest-based biofuel production and its application to optimal facility size determination," Forest Policy and Economics, Elsevier, vol. 38(C), pages 32-39.

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