After much good fortune, ethanol industry braces for some unwanted attention
After a spurt of good fortune, the fledgling U.S. ethanol industry is anticipating some growing pains that could bring it unwanted attention this summer.
Ethanol’s public profile rose significantly for the better last July when Congress passed an energy bill that mandates the doubling of biofuels output by 2012. In January, President Bush gave the industry a further boost with a strong endorsement in his State of the Union speech. And with the imminent phaseout of a petrochemical added to gasoline to reduce tailpipe emissions, more U.S. motorists will depend on the corn-derived fuel than ever before.
But there’s trouble looming: The ethanol industry might not be ready to satisfy the expected summertime jump in demand. And by crimping the overall supply of motor fuel, this could contribute to a spike in gasoline pump prices at the start of the country’s peak driving season.
That, at least, is the view of the Energy Department, which issued a report last month detailing the challenges midwestern ethanol producers will have in getting their fuel to key markets along the East Coast because of railroad, trucking and other distribution bottlenecks. The report also highlighted concerns about the limited output capacity of an industry still in its infancy.
The Renewable Fuels Association, a trade group representing ethanol producers such as Archer Daniels Midland Co. and Pacific Ethanol Inc., says the industry’s challenges and their influence on gasoline prices are being overblown. The association sent an angry letter to the Energy Department last week, questioning the overall thoroughness of its research and accusing it of creating “unnecessary fears in the marketplace.”
Still, ethanol-related worries hang over the U.S. market, contributing to a 42-cent-per-gallon increase in unleaded gasoline futures since mid-February. There are other factors behind the
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In this area, Southeast Kansas, Conoco stations and some independents carry E-10 ethanol gasoline, graded as 89 octane, but generally sold at the same price as 87 octane, the generally accepted lowest grade sold around here. right now that is about $2.39 per gal.
I am curious if anyone has experienced any problems running the 10% ethanol added gasoline in their cars.
Sam
Haven’t had a bit of trouble running a 10% ethanol blend. A truck stop around here began carrying E-85 about a year ago and whenever I gas up there I’ll usually put 1/4 tank of E-85 and blend it the rest of the way with regular gasoline. It doesn’t cause any problems other than makes the exhaust on my truck smell funny.
Odd…I don’t see anyone reopening the shuttered ethanol plants in SE Colorado. (Campo, Walsh, Holly … or for that matter Ulysses, KS Tennis, KS or St. Francis, KS)
No problems here. I even use it in our Pontiac Bonneville SSEI, which has a supercharged engine requiring Premium. Runs great. Here in Iowa, ethanol blend is subsidized, so it’s 10 cents cheaper/gallon than straight unleaded.
