THE FARMERS are back in town this week, blessedly without their tractors this time. They are here to lobby for, among other things, the right to build stills to make alcohol for use in producing gasohol. On first glance, that seems to make perfect sense: take corn and other crops, food-processing wastes and spoilage, ferment them and turn the product into alcohol to supplement scarce gasoline. Better yet, remove all the middlemen and the transportation costs and make the alcohol right on the farm. But a more careful look reveals enough problems to warrant some caution.
As is the case with other re discovered energy resources, the currently available technologies for making gasohol are decades old. There is so much room for improvement, in fact, that a few years of research are likely to produce new processes that make today's obsolete and uneconomic. Therefore, moving too quickly to apply current technologies could be a very costly mistake.
Promoting gasohol too enthusiastically could also raise the price of food -- a result the economy hardly needs at current inflation rates. The price at which gasohol can be sold is tied to the rising price of gasoline. This means that the price of corn and grain used to make the gasohol is likely to rise, thereby automatically raising the price of the entire crop -- that used for food as well as that used for fuel.
Congress' Office of Technology Assessment recently studied the likely effects of gasohol development.It found that most of the fuel farmers use is diesel fuel and that the alcohol produced on the farm would probably cost about double the current cost of diesel fuel; that stills are difficult to operate safely (there is a substantial risk of explosions); and intensive cultivation of crops for gasohol could eventually raise the price of land -- already a farmer's biggest expense. All in all, the study concluded that, under present conditions, on-farm production of gasohol is, at best, economically marginal.
Notwithstanding all these drawbacks, it probably makes sense to proceed with gasohol -- slowly. Despite the lack of clear-cut economic benefits, farmers would gain from the increased employment and self-sufficiency that on-farm stills would bring. But the pitfalls must be avoided. Gasohol production from food crops must not rise to a level at which it begins to push up the price of food. And if government is to provide economic incentives for gasohol development, better ways must be found than the current subsidies at the gas pump, which have already driven the price of alcohol far above the costs of its production.