It is a little off topic, but there is one snippet in the article that is sure to result in some sort of legal action:
"I have so much oil," said David MacKay, owner of a Northeast Portland fish house, Halibut's. "If they don't take it, I'll dump it on the grass."
In light of the falling ethanol market, Pacific Ethanol is losing some of their biggest investors, the Gates Investment Fund. The falling ethanol market isn't coming as much of a surprise; I'm not entirely sure why the big money is pulling out of functioning plants.
Fuel has an inelastic demand curve - we use a lot of it and there is a ceiling to how much we can use. If too much is produced, we won't be able to use it all.
There was so much buzz around ethanol that everyone with a spare $10m started invested in plants. Industry insiders knew that at some point there was going to be too much supply and some of these plants opening wouldn't be able to get off-take agreements and therefore go belly up.
The only potential negative of all of this is if it stifles cellulosic ethanol research, much like cheap oil in the early nineties stifled algae-BIODIESEL research.
Net effect - once again supply-demand economics wins the day and more alternative fuel is available. Also once again, there are no silver bullets to kill the looming werewolf of all our problems and people are writing reactionary news articles.
No comments:
Post a Comment