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Ghee is clarified butter. It is sattvic and balancing for Vata, Pitta and Kapha when taken in appropriate quantity and at appropriate times. Clarified butter keeps well at room temperature, but can be refrigerated.
While you can buy ghee, it's easy and much less expensive to make your own. All you need is unsalted butter. The best ghee is made from European-style cultured butter. Organic Valley is a widely-available brand that now comes from pastured cows.
You’ll get a feeling for how long this will take after you’ve done it once or twice. On my stove it takes 3-4 hours, and most of that time is spent in getting to the boiling point. If you’re in a hurry, start with medium heat and turn to low once the butter begins to boil. But be careful – you can get explosive spattering of hot butter when the water starts to boil off. Once boiling begins you’ll likely have somewhere between 15 and 30 minutes to go.
If you don’t go long enough, you’ll leave some water at the bottom, which you’ll likely notice as a separate brownish layer when you pour off into the jars. That’s not really a problem as long as you don’t get it in the jar. Even if you do, the water will settle to the bottom. This will just make it more likely for a thin layer of rancidity to occur there.
Conversely, if you neglect the ghee and it cooks too long after all the water has evaporated, the temperature will rise very high. The milk solids will burn. The ghee will turn black and take on an awful taste – a true disaster. Then only good option is to start over with fresh butter. If it’s only a little overcooked, you may be able to recover. Strain the ghee into a clean saucepan, add some milk (a clarifying agent) and repeat the cooking process.
Ghee can substitute for butter or oil for general purpose cooking, but not for baking. It will give baked goods a dense, oily texture. So try it for carrot cake if you like.