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Expand ethanol to reduce gas prices

March 11, 2012

By Renewable Fuels Association

In a letter sent  to House Subcommittee on Energy and Power Chairman Ed Whitfield (R-KY) and Ranking Member Bobby Rush (D-IL) before a hearing on gas prices, the Renewable Fuels Association (RFA) and the Advanced Ethanol Council (AEC) underscored the gas price benefits of increased ethanol production and use and urged action on key issues related to the industry. “While the issue of gas prices is complicated, there are concrete and immediate actions that Congress could take to help reduce America’s exposure to volatile world oil markets and the subsequent spikes in gasoline price we are witnessing today,” wrote RFA President and CEO Bob Dinneen and AEC Executive Director Brooke Coleman.

Specifically, Dinneen and Coleman urged Congress to maintain the integrity of the Renewable Fuel Standard (RFS), extend critical expiring tax cuts for cellulosic ethanol production, and invest in alternative fuel infrastructure such as blender pumps and flex fuel vehicles to utilize higher level ethanol blends by passing the Open Fuel Standard introduced in the House by Rep. John Shimkus (R-IL) and Rep. Elliott Engel (D-NY).

“The economics today are quite clear. Currently, a gallon of ethanol is selling for approximately $1 less than a conventional gallon of gasoline. At the standard E10 ethanol blend, that is an immediate savings of $0.10 per gallon for American motorists. With increased ethanol blending, like levels up to E15, the savings would be even greater,” Dinneen and Coleman explained. In an Issue Brief sent yesterday, the RFA outlined the gas price benefits of ethanol today. That brief is available here.

Dinneen and Coleman continued, “By their very nature, markets fluctuate and respond to basic supply and demand dynamics. What is true today may change six months from now. The only way to avoid this continuous rollercoaster of oil and gasoline prices is to provide Americans with a real choice at the pump. Maintaining critical policies like the RFS, extending key tax policies for new fuel commercialization, investing in renewable fuel infrastructure, and passing innovative polices like the OFS are actions that Congress can take this year to provide Americans choice in the fuel they use and help mitigate the damage wrought by the vagaries of oil and gasoline markets.”

The entire letter is available here.

  
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Expand ethanol to reduce gas prices – Oregon Natural Resources Report March 11, 2012

[...] Expand ethanol to reduce gas pricesOregon Natural Resources ReportBy Renewable Fuels Association In a letter sent to House Subcommittee on Energy and Power Chairman Ed Whitfield (R-KY) and Ranking Member Bobby Rush (D-IL) before a hearing on gas prices, the Renewable Fuels Association (RFA) and the Advanced Ethanol … [...]

sam March 11, 2012

ethanol has to be 1/3 less in price just to break even.In fex vehicles it cost more to use e85 than regular gas,go tofuel economy.gov and check it out.Time to own up to the truth and get the country back on the right track.

Charlie Peters March 11, 2012

GMO corn fuel ethanol stinks

Bob Clark March 11, 2012

This article is very misleading when it cites the $1 per gallon advantage of ethanol relative to gasoline price. All of this price advantage disappears when ethanol’s lower energy content per gallon (reportedly about two-thirds that of gasoline) is adjusted for. Ethanol, because it holds less energy per gallon than gasoline, means stopping more frequently at the gasoline station to fill-up. Do we really want to force ourselves to make more stops at the gasoline station? I don’t think so.

So, the ethanol fuel folks are demostrating here their grab for public dollars and regulation to limit their competition – a form of crony capitalism. Ethanol folks are big enough boys and girls not to require continued government favoritism.

tim smith March 14, 2012

Besides what Bob Clark has to say about this article [This article is very misleading when it cites the $1 per gallon advantage of ethanol relative to gasoline price. All of this price advantage disappears when ethanol’s lower energy content per gallon (reportedly about two-thirds that of gasoline) is adjusted for] What this article also fails to explain is that ethanol is cheaper to make than petro-gas due to the heavy federal and state subsidies. It is also false economy when you deflate the cost of one necessary commodity (gas and diesel) at the expense of another necessary commodity (food). In this case of ethanol/biodiesel vs food,the price of corn has forced up the price of all other grains which have both forced up the price of beef , pork and poultry by in some cases nearly double it. We need to look at the cost of producing a BTU or Calorie of energy and not be schmoozed by the falsely warm and fuzzy language of ‘green energy’. We have plenty of time to develop alternative power sources over the next couple centuries that it will take to deplete our domestic petroleum reserves.

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