Study: U.S. Energy Policy Fuels Global Insecurity

New research funded by the Defense Department concludes that U.S. laws that require fuel suppliers to blend corn-based ethanol with gasoline contribute to social instability and armed conflicts in the Middle East and Africa.
U.S. production of corn-based ethanol over the past six years — along with commodity trading speculation — has kept food prices artificially high, which has caused unrest in parts of the world that the Pentagon regards as strategic hotspots, contends astudy by the New England Complex Systems Institute.
The use of food-based feedstocks in alternative fuels has been a hotly debated topic for years. Other experts have rejected NECSI's conclusion.
The study, first published in July, identifies U.S. government ethanol subsidies and mandates as the cause of soaring food prices that have led to civil unrest and violence in countries where Al-Qaida and other extremist groups look for safe havens. "While there have been several suggested origins of the food price increases," NECSI concludes, "We find the dominant ones to be investor speculation and ethanol production."
NECSI is an independent academic research and educational institution in Cambridge, Mass. Its investigation on the impact of food prices on global security was partly funded by U.S. military agencies, including the Office of Naval Research, the Air Force Office of Scientific Research and the Army Research Office.
Yaneer Bar-Yam, one of the report’s authors and president of NECSI, cites violence in Yemen as an example of the unintended consequences of the U.S. ethanol rule. Yemen, which is considered a global terrorist base for Al-Qaida, has been riven by sectarian strife for many years. NECSI researchers, however, found that since 2008, increasing global food prices triggered a new wave of violence and food riots.
U.S. policies that have promoted conversion of corn to ethanol and commodity speculation are direct contributors to the violence, he says in a recent interview. “The pursuit of ‘energy security’ is actually making the United States less secure,” says Bar-Yam.
Upheaval in the Middle East and North Africa continues to take American lives and military resources, which should be a motivation for the United States to reconsider the ethanol mandate, he says.
Congress passed the Renewable Fuel Standard (RFS) legislation in 2005 and the Energy Independence and Security Act in 2007, which set targets for biofuel production. For 2012, the law required production of 13.2 billion gallons of corn-based ethanol, and 13.8 billion gallons in 2013. Gasoline blenders must produce a 10 percent-90 percent ethanol-gasoline mix. When the law was enacted, the goal was to reduce the nation’s dependence on imported oil. Supporters of the legislation also tout its economic benefits, as the ethanol industry has bolstered the economy of several corn-producing states.
Bar-Yam said food price peaks in 2007 and 2008, and in 2010 and 2011 correlate with a rise in food riots across the globe — estimated at 60 in 2007 and 2008. The Arab spring in 2010 and 2011 also coincided with a rise in food prices, he says.
“If you look at food price peaks: you see the violence breaks out when the food price index reaches [its highest points] ... We modeled food prices based on ethanol and financial speculation.”
The research is conclusive, he says. “When people don’t have food they go to the streets and disrupt social order, which creates an incubator for terrorist activity.” He estimates that the amount of corn used to produce the ethanol mixed in a gallon of regular gasoline would feed a person for a day.
A severe drought in the United States over the past year prompted the governors of 10 states to request that the EPA consider suspending the ethanol mandate, but the agency declined, citing data that showed a negligible increase in the price of corn as a result of the drought.
The Obama administration should consider the security implications of this policy, says Bar-Yam. “Reducing food prices would benefit global security.”
Ethanol was supposed to reduce oil consumption, but it is not clear it has achieved that, he says. “There are plenty of other energy sources” that do not affect food prices.
The Defense Department, which has spentmillions of dollars developing and testing biofuels, has insisted that the feedstock used in all its biofuel projects must come from non-food sources. Unlike ethanol, which is a low-density fuel and must be blended with fossil fuels, the military’s biofuels must be “drop-in” substitutes, with comparable energy and performance as petroleum products.
Andrew Holland, a senior fellow at the American Security Project, disagrees with the findings of the NECSI study regarding the impact of corn-based ethanol on high food costs. In late 2007 and early 2008, there was a fast spike in the price of food, and riots broke out all across Africa. But those developments were not connected to U.S. production of corn-based ethanol, he says. “Corn ethanol is important for America’s domestic energy security,” Holland says. “If you keep the price low, it undercuts local production. That’s a simplistic view. But there’s not that much correlation between corn ethanol and the price of food,” he adds.
There is, however, a much stronger link between the price of food and the price of oil, and between price of food and bad weather,” Holland says. “It’s not as simple as the United States keeping corn cheap.”
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Topics: Energy, Alternative Energy, Energy Security