Manitoba energy minister Tim Sale knows there are plenty of skeptics as he and his government embark on an effort to expand ethanol production and consumption in the province.
Over the past year, the provincial NDP government has heard from livestock groups concerned that a jump in provincial ethanol production might crimp feed grain supplies in a region already struggling with feed shortages.
The government also heard from two well-regarded agricultural economists who suggested that rather than creating a new market for prairie feed grain, new large ethanol plants in Manitoba would instead need to draw on imported American corn.
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And there were those who questioned whether the government was shifting its focus from direct support of farmers to indirect support through the subsidized production of ethanol.
Topping it off were criticisms from a national farm group that argued ethanol production remains inefficient, using more energy than it actually produces.
Keeping all those things in mind, Sale and his government reached a conclusion this fall: it’s time to move ahead with ethanol expansion in Manitoba.
Sale recently announced legislation that would allow the province to require 85 percent of gasoline sold in Manitoba to be blended with 10 percent ethanol by September 2005.
The ethanol program is to include a tax preference on ethanol-blended gasoline so consumers would not experience a price increase as a result of the program.
Behind all that is a desire by Sale and his government to see a quantum leap in Manitoba ethanol production, which he said they are already working on with agricultural industries, grain growers, ethanol producers, fuel blenders and local communities.
“We think that to meet the legal mandate in Manitoba, the ethanol will be produced in Manitoba.”
There is one significant ethanol maker in Manitoba, generating what Sale pegged at about nine million litres per year. To satisfy the government initiative announced Nov. 21, there will need to be at least 140 million L available.
Bold? Maybe. Achievable? Sale thinks so.
“I don’t think there will be a shortage of people planning to make ethanol,” he said in an interview last week.
“I think some of them will also be making it for export to the American market.”
While helping reduce greenhouse gas emissions, Sale pledged that the government’s ethanol initiative would become a new engine of economic growth for rural Manitoba. He said there are at least six Manitoba communities preparing for an opportunity to embrace ethanol production. Farmer co-operatives teamed with similar groups in the United States might be among those capable of building ethanol plants in Manitoba, he added.
“This is just so clearly an initiative whose time has come.”
But what about the skeptics? After hearing the concerns, does the government not see risk in choosing ethanol as one of the main struts to prop up the sagging fortunes of rural economies?
Apparently not.
Sale offered rebuttals for the main criticisms that have been levelled against ethanol expansion.
On the topic of feed grain supplies, he said Manitoba has ample capacity to produce more feed grain to accommodate ethanol expansion without cutting into supplies needed by hog and cattle feeders.
“We just don’t accept the notion that we can’t grow enough. We know that we’ve grown more than enough in the past.”
He cited winter wheat as one crop with potential to deliver the yields needed to support ethanol production in Manitoba. He’s confident farmers will grow more grain when they see an established market.
“The capacity on our land to grow feed grain, and particularly winter wheat, is very significant. We don’t need anywhere near what we could grow in order to feed an ethanol industry.”
Rather than limiting feed supplies for the livestock industry, Sale said ethanol production could benefit cattle feedlots and hog finishing barns. The grain left after the starch is extracted during distilling is high in protein and sought after in other jurisdictions where ethanol is produced, he said.
As well, rather than encouraging imports of American corn, Sale suggested a large ethanol industry in Manitoba could result in a displacement of the roughly 300,000 tonnes of soybean meal imported into the province from the United Sates each year.
On the question of whether the government is shifting its support for farmers, Sale said he does not understand the logic of that argument, especially in light of the benefits he anticipates for agriculture and rural communities.
As for the efficiency of ethanol production, the energy minister said critics who suggest the industry would consume more energy than it generates are basing their argument on “old studies based on old data.”
He said modern ethanol plants generate far more energy than they consume and produce limited effluent.
“I think the energy balance issue is a red herring now. In my view, it’s been disposed of.”
