Imported Crude Oil Independence

May 16, 2011 |

Brazilian fuel pump offering options between 100 percent gasoline and 100 percent ethanol

By Don Siefkes, Executive Director, E100 Ethanol Group

The United States currently imports 3.3  billion  barrels/yr of  crude oil. This yields 66 billion gallons/yr of  gasoline, about 50% of America’s total gasoline usage.

As article after article in Biofuels Digest has pointed out, the ethanol industry knows how to make ethanol from a variety of feedstock and could make 66 billion gallons/yr of fuel grade ethanol in short order without interfering with food production.

The E100 Ethanol Group believes the current strategy of going to 15% ethanol content gasoline and more E85 vehicles will not generate a market of that size and will not make the U.S. independent of  imported crude.

After careful  interviewing of dozens of retail gasoline franchisees and drivers over the last 18 months, the E100 Ethanol Group has concluded that the lack of  E85 sales is not due to lack of availability or lack of knowledge that the vehicle can burn E85. It is due to poor mileage, higher cost per mile, and more frequent refueling stops.

These negatives cannot be overcome by continuing to put ethanol into an engine optimized for gasoline. The engines need to be optimized for ethanol. Sturman Industries, Mahle  Powertrain, Nissan, Saab, Hp2g, MCE-5, and others have demonstrated the ability to make competitively priced engines that can be optimized  for E100 (98/2, EtOH/IPOH) yet could still burn gasoline if E100 were not available.

Like airbags, seat belts, and unleaded fuel, however, these technologies will not come into production without a government mandate.

The E100 Ethanol Group suggests a strategy of having Congress enact a bill containing the  following three major points:

1. A mandate that at least 50% of all new light vehicle  inventory be E100 capable by Jan.1, 2017 with strict mileage requirements when running in E100 mode. The E100 Ethanol Group would suggest 30 mpg highway for small to mid-size vehicles and 24 mpg highway for larger vehicles.

2. A clause that any motor fuel franchisee can sell E100 under a branded canopy. This gets around the fact that many oil company franchise agreements require the E85 pump to be in an area outside the branded canopy.

3. A clause that any motor fuel franchisee can purchase E100 from any supplier. This  would permit the ethanol industry to sell ethanol as a primary motor fuel directly to a retail distribution system bypassing the pricing control of the oil companies.

This strategy would be similar, not identical, to what Brazil did to turn itself into a net crude oil exporter. Every gasoline station in Brazil has a dispenser offering the Brazilian version of E100, called Etanol Comun. Over 80% of all new light duty vehicles sold in Brazil can burn Etanol Comun.

The above strategy would assure the future of the ethanol industry, give the industry pricing control over its product, and, at long last, make the U.S. independent of imported oil.

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