Bio Fuel Goals - are they Realistic?
By: Lance Winslow
We have heard some strong warnings from our President that America must kick her addiction to gasoline and Foreign Oil. But can we kick the habit without causing a total headache in our economic vitality in the short term?
There appears to be no simple solution to make the switch as graceful as we wish. And critics warn of many problems with growing our own fuel such as droughts, weather related crop failures, fires, GM Crop debates and environmental runoff of pesticides, fertilizers and nitrates. Luckily many companies like Cargill, Monsanto and ADM have most of these problems licked, thanks to previous initiatives, funding and research sponsored by the US Government.
But even so this does not address the issues of supply and distribution. You see there is going to be problems with capacity, refining and distribution as supply and demand grow together and they must for success. If supply outpaces demand the lower resultant in prices will not support rapid industry expansion thru necessary capital flows. If demand outpaces supply, consumers will lose faith in the choice to switch to alternative fuel automobiles. Additionally price spike issues are troubling as a large crop failure could cause intense fluctuations in price, as bad or even worse than the 2005 price spikes due to Hurricanes Katrina and Rita and the Commodity game players in Chicago.
How can we make all this work? How can we get the fuel stations and distribution in place now to make this vision a reality? Well it may not be as difficult as you think, jobbers and wholesalers will sign up to have these fuels, as people wish to buy them. We have thousands of key-card fuel distribution points in the United States already, huge travel centers and we will see in metro areas entrepreneurs putting in hybrid gas stations or converting islands to use alternative fuels.
When large trucking companies and government agencies switch a large part of their fleets to alternative fuels and put in their own point to point distribution terminals their demand will cause regional jobbers to carry these additional fuels and thus make them available to the consumer markets. Without the supply and distribution in place prior to flooding the market with millions of alternative fueled vehicles per year, the system cannot sustain the vision. Luckily there is little if any conversion changes needed in most modern automobile to use ethanol.
Bio-Diesel is available and could be more readily available in more states if there was more demand from consumers with diesel cars. Currently we see several large Automakers with plans to introduce diesel cars models into the US Market. In many nations around the world most automobiles are already predominantly diesel.
The Presidents Bio Fuel Goals are realistic and the free market can take care of this. We can prevent the extortion from Nation States holding us up for ransom and over a barrel, if we come together and make this vision a reality. Consider this in 2006.
Lance Winslow - Online Think Tank forum board. If you have innovative thoughts and unique perspectives, come think with Lance; www.WorldThinkTank.net/wttbbs/