Even the experts didn't anticipate the consequences of building an ethanol plant in Granite Falls.
Typically, ethanol plants are built to run for upward of 20 years. "But the tests showed that the long-term viability of that aquifer system would not allow that as their source for the duration of their plant," says Minnesota Department of Natural Resources hydrologist Jay Frischman. So the DNR granted a temporary three-year permit.
After one year of operation, however, the plant had reduced the aquifer's water level by 90 feet, exhausting roughly half the reservoir. Frischman was alarmed, to say the least. "It was even more than I anticipated, and I felt I was being conservative in my approach," he says.
Luckily, the Minnesota River was located just a quarter-mile from the plant. The river water, which is also protected and permitted by the DNR, requires less treatment and contains less sediment than groundwater, making it more efficient. Before, the plant consumed roughly 3.7 gallons of water to create one gallon of ethanol. Now, only about 2.6 gallons of water are needed, says plant manager Robin Spaude.
The example points out a little-known downside to the ethanol craze: The industry uses massive amounts of water. It's a key component during the fermentation and cooling stages of ethanol production. And most plants in the state are much less efficient than Granite Falls, which has the benefit of being located near another water source. Minnesota Energy, a plant in Buffalo Lake, uses 4.5 gallons of water to produce just one gallon of ethanol.
All told, the state's 16 ethanol plants use a total of 1.9 billion gallons of water each year to produce over 562 million gallons of ethanol. With five new plants under construction, and several others looking to expand, the state's production capacity could reach one billion gallons by 2008, requiring the use of more than 4.3 billion gallons of water. That's slightly less water than was consumed by the city of St. Cloud in 2006.
Experts say there is a significant risk that increasing ethanol production could suck groundwater dry. Already, officials in and around the Midwest are delaying or denying approval of permits for ethanol plants out of concern for the water supply.
"What you want is to protect your water supply for future population and economic growth," says Jim Japs, assistant director of the DNR's Division of Waters. "Those are the two things that drive cities. Ultimately, if you don't have the water, you're not going to have the growth."
W hile technology is helping plants use less water—and efforts are underway to recycle some of the water used in the production process—many plants lag far behind in efficiency. Some use less than three gallons of water for every gallon of ethanol they produce, while others use more than five. On average, plants use about 4.3 gallons of water for every gallon of ethanol, according to the Minnesota DNR.
"There is a potential to be a problem if there is continued expansion of projects," says Sean Hunt, a hydrologist with the DNR's Division of Waters.
Ethanol isn't a product that stays here. As the U.S.'s fourth-largest ethanol producer, Minnesota is providing much of the ethanol used as fuel by the rest of the country. More than half of the ethanol produced here is shipped elsewhere. Most of the demand comes from places like the East Coast, the Chicago corridor, and the Los Angeles area. When California banned the use of Methyl Tertiary Butyl Ether (MTBE), a toxic fuel additive, ethanol was suggested as an alternative.
In 2006, Minnesotans consumed an estimated 263 million gallons of ethanol, only about half of what the state produced, according to the state Department of Agriculture. While that's good for the local economy, it also means that our local water supply is being shipped to other states in the form of ethanol.
"The ethanol industry is mining our groundwater," says Janette Brimmer, legal director for the Minnesota Center for Environmental Advocacy.
In the Twin Cities, water is readily available, but other regions around the state aren't as fortunate. The bedrock aquifers don't exist in the southern and western portions of the state, which makes groundwater much harder to come by. That's also where most of the state's corn is grown, and where the majority of the ethanol plants are located.
"The things that really drive the locations of these plants are mainly corn availability and rail lines," says William Simpkins, a professor of hydrology at Iowa State's Department of Geological and Atmospheric Sciences. "Water comes into it, but water's not the top dog."
Groundwater is also scarce in other parts of the country looking to expand ethanol production, says Mark Muller, director of the Institute for Agriculture and Trade Policy, a nonpartisan, farm-advocacy think tank based in Minneapolis. Nebraska and western Iowa are both very dry regions that are making efforts to increase their ethanol production.
"Mining" water that is closer to the surface could result in a dryer landscape, says Bob Libra, a geologist with Iowa's Department of Natural Resources. "Some of that stuff has been in place for hundreds of thousands of years. If you take that out of the bank, you don't know when you're going to get it back."
Despite these concerns, many states and the federal government have failed to monitor the water issue closely, and acknowledge they don't know if ethanol plants are using more water than their aquifers can withstand.
Nationally, government oversight for water use is spotty, at best. In fact, a call from this reporter was the first inquiry the Environmental Protection Agency's press office in Washington, D.C., had received regarding ethanol and water consumption. "The state has quite a bit of authority," says EPA spokesman John Millett.
Yet states don't do much better in tracking the issue. In a recent paper, "Water Use by Ethanol Plants: Potential Challenges," Muller and co-author Dr. Dennis Keeney discovered that "minimal data is available on groundwater depletion, and the scope of future water availability is not clear." The study also found that there are no public records available that document water use by ethanol plants in the United States.
In a review of ethanol-producing states, it appears that only Minnesota keeps tabs on water use by specific plants and the amount of ethanol produced. Those numbers are reported to the DNR Division of Waters by the ethanol plants themselves.
But even Minnesota lags in some areas. The Groundwater Protection Act of 1989 required the DNR to map and identify sensitive groundwater areas.
"The DNR basically hasn't done it," says Brimmer. "We're now in year 18; I think we could have made a little more progress."
Ethanol plants in Iowa are required to apply for a water withdrawal permit from the Iowa DNR anytime the use is greater than 25,000 gallons of water per day, but government officials say the process has no authority.
"The way they are funded, they feel they're more of a registration program than a permit program," says Libra, of Iowa's DNR.
Permits are issued by a staff of about two people who make decisions based on in-office assessments and no fieldwork. Basic information about groundwater availability and permitting isn't readily available, if at all. Some of the groundwater data is more than 20 years old.
Iowa ethanol plants must maintain up-to-date water use records and file them with the DNR, but the permits "are not given the review they should be," says Libra. "The problem with that, of course, is that when you don't have anything to do with it, it goes into what we call a shoe box in the back of somebody's office."
The Iowa cities of Ames and Nevada share the same aquifer, which the Lincoln Way Energy ethanol plant also taps into. In fact, the 50-million-gallon facility never applied to the state for a water use permit, instead using Nevada's city water supply pipe.
Simpkins, the hydrology professor at Iowa State, is currently mapping the aquifer for the city of Ames to determine if the added water stress could be a problem in the future. Although there is ample water now, Nevada is looking to drill another well, and in the past, the ethanol plant has discussed doubling its size.
Nevada has a population of about 6,000 people. With the amount of ethanol Lincoln Way is preparing to produce, the city is going to use 200 million gallons of water per year. That's nearly twice as much water as the city was drawing from the aquifer before the ethanol plant was there, Simpkins says. "It's like doubling the size of Nevada."
Some worry that in the case of a drought, big business will take priority over the average household.
"What do we do during those times where water is in shorter supply?" asks Susan Heathcote, a water expert with the Iowa Environmental Council. "There may not be enough for everybody."
Politicians have embraced ethanol, seeing it as a way to court everybody from farmers to environmentalists to hawks who want to reduce America's dependence on foreign oil. Many of the high-profile presidential candidates, including Barack Obama, Hillary Clinton, and Rudy Giuliani, have called for the expansion of ethanol.
With the recent political support for ethanol, many investors looking to get into the boom are citing the Granite Falls plant as precedent. They, too, are requesting that the DNR issue a temporary start-up permit, hoping to find a sustainable water source later.
So far, the DNR has been denying those permits. For instance, the department nixed plans to build a 100-million-gallon Cargill plant in Pipestone, fearing that the local water system couldn't support it.
Ethanol alone won't solve the energy crisis. And if we're not careful, it could create an entirely new problem.
"Ethanol is a bridge fuel," says Bill Fink, a former Iowa state senator and energy expert with the Iowa Environmental Council. "Putting all of our energy eggs in one basket here would be very, very foolish."