Ethanol Has Believers But Faces Huge Hurdles

The prospect of a home-grown energy source has politicians promoting ethanol as a solution for everything from reduced smog to lowering dependence on foreign oil. We asked two thousand BuyingAdvice.com readers for their view on the debate.

Almost 65 percent of those surveyed said they regard ethanol as a viable solution to our future energy needs and 60 percent said they would switch to ethanol if it were the same price as gas.

The commercially available fuel usually referred to as ethanol is a blend of 85 percent ethanol and 15 percent gas, called E85; FFVs operating on E85 usually experience a 25–30% drop in MPG due to ethanol’s lower energy content.

According to the USDA, in response to increased demand, bio refineries quickly expanded production while new technologies increased efficiency at existing plants. The increased demand led to a rapid rise in the number of U.S. ethanol plants to 204 plants in 29 states, producing more than 13.2 billion gallons in 2010.

A fifth of U.S. corn going to ethanol production

Some estimates say that a fifth of U.S. corn production is already being used to make ethanol and the Department of Agriculture has reported that the growing market for the fuel is driving up feed grain prices and could impact the cost of food.

The USDA is projecting corn demand for ethanol at 5.15 billion bushels for 2011-2012, translating to almost 14 billion gallons of ethanol produced in 2011, up from 13.2 billion gallons in 2010. That 13.2 billion gallons of ethanol displaced approximately 445 million barrels of crude oil at an estimated price of $34 billion.

Research is concentrating on expanding the substances used to create the fuel to include grasses, wood pulp and the discarded byproducts of corn production such as the stalks and leaves.

While the focus in the U.S. has been on producing ethanol from corn, any plant material with heavy starch content can be refined to produce the sugars which form the basis for ethanol. Most of the fuel produced in Latin America is derived from sugar cane.

Distribution a Major Hurdle

But even as production problems are overcome, before it becomes more widely used ethanol has to develop a distribution network that can make the fuel more widely available.

When asked what they regarded as the chief obstacle to wider use of ethanol, 43 percent of our survey sample listed availability as the biggest barrier. There are currently more than 2,000 filling stations in the U.S. that sell E85 and that number is increasing rapidly, with a heavy concentration in the upper Midwest close to corn producing areas.

Ethanol cannot be distributed using the same pipelines used for gasoline because is it much easier for the fuel to be contaminated by water. Currently supplies of the fuel are distributed by road or rail tankers.

According to the U.S. Energy Information Administration, there are more than 8 million FFVs on U.S. roads today; however, many flex fuel vehicle owners don’t realize their car is an FFV and they have a choice of fuels.

There are now approximately 38 different 2012 models that can run on E85, not including full-size vans, heavy-duty trucks and exotic vehicles. While we have seen more cars become E85 capable, trucks and sports utility vehicles still dominate the flex-fuel vehicle list.