Aimlessness on Energy

I commented over at the Standard yesterday that Democrats seem not to know where they want to go on energy legislation. Their overall goals appear to include lower production of petroleum and gasoline (seen in opposition to drilling in ANWR and opposition to coal liquification), increased use of more expensive and less efficient alternate fuels, and lower prices.

See anything amiss there?

The Hill looks today at both the House and Senate energy bills, and notes fights over coal liquification and CAFE standards.

And don't underestimate the importance of the fight over renewable fuel goals. As Foreign Affairs has noted, a lot of corn is going into ethanol production, dramatically raising prices for corn-based foods. One commodity affected? Chicken feed:

Meanwhile, efforts by interest groups could further open regional divides. Livestock producers are pushing for an amendment that would waive implementation of the renewable fuels standard if corn prices grew too high. They say that increased demand for ethanol — a high priority for agriculture-state lawmakers — is driving up the prices for livestock feed to record levels.

The price of chicken feed, for instance, has increased 60 percent over the last several months.

“We’re hoping for some relief,” said Richard Lobb, spokesman for the National Chicken Council, a trade group.

According to Dr. Bruce Babcock of Iowa State University, the average American grocery bill will rise by $50 in the next two years alone, simply because of the increased use of corn for ethanol:

Hart says that'll mean a hike of about 5% in the price of milk, beef, pork and chicken. "The producer will see it, but not enough to change consumption patterns," Hart said.

And, Ag Secretary Mike Johanns says livestock producers-- and their consumers-- may not get a break for two years. But, ethanol producers call this a "short term situation." "We don't like high corn prices either," said Don Endres, VeraSun CEO. "But, we're convinced that the "long-term" is very good."

Ethanol and other alternative fuels have ramifications and costs that are not generally discussed. We ought to discuss them.