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Monday, July 14, 2008

Ethanol Savings: Big Bucks or Pocket Change?

KJAM reprints text from the latest study from the South Dakota Corn Utilization Council. (Hey, about a Corn Eating Council?) The study offers this very interesting if: If all gasoline sold in South Dakota were E-10 (10% ethanol blend), every South Dakota driver would have saved $86 over a year of driving ending March 2008.

Cheapskate that I am, I'm not one to sneeze at $86 (and the tip jar in the left sidebar is open!). We claim our share of those savings by using E-10, and I may yet work up the courage to experiment with E-85 in my Jeep.

But if you're after savings, consider that I saved over $900 over the past twelve months by giving up the commute and working in Madison. And if gas stays at $4 a gallon, I'll save more than $200 a year by working from home and biking to work in Madison instead of driving every day. I'm saving money and using less fuel, not to mention staying in shape.

The point: new technology and new fuel sources can produce savings. But lifestyle changes—choices you make, not Pierre, not Washington, not corporations—can save a lot more.

17 comments:

  1. From what I have been told, if you continuously use E85 in a vehicle that takes that type of fuel, you can get the same gas mileage as if you were using E10 or Premium.

    Also, you and others have talked on here that the higher prices for fuel is a good thing. It is making us look closer at our environment. One thing that noone has discussed is that the extra money we are paying for oil is going into the pockets of the people that are at war with us. I read an article on CNN that the Prime Minister of Iraq is handing out money to try and boost their economy. Ok. But the phrase from that article that stands out is they are handing out the "glut of money" from increase oil revenues. So again, who is making the money here on the high prices of oil?

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  2. PP,

    I've never heard or seen anyone who get nearly as good of mileage with E85 as they get with E10 and clearly not premium. What most people find is that with the cheaper fuel at lower mileage, they break even. The LECG report noted here never talks about loses or gains in fuel mileage.

    Oh yea, and the "South Dakota-specific analysis" was conducted by the California-based LECG. The closest office they have to South Dakota is in Chicago. Perhaps the South Dakota Corn Utilization Council should look for news closer to home.

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  3. I know someone that bought a new vehicle that uses E85 and they are getting 30mpg with E85. The thing is, you have to run strickly E85 for the computer in your engine to adjust to the diffferent type of fuel. The problem people run into is they fill up with what ever is near by (E85, E10, or Premium).

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  4. Well if they are ONLY using E-85, how does he know he can't get 35mpg. Your logic is flawed.

    We have used E-85 and E 10. We consistantly lose 2 mpg with the E-85. We are going to get a transmission flush and an oil change. Then use E-10 only and see what kind of gas mileage we can get.

    I think it's like putting sugar inyour gas tank.

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  5. With the type of vehicle tey bought, it's only rated at 32mpg for regular fuel. Loss of 2 mpg and save $2/per gall. Hmm.. You do the math.

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  6. A vehicle is simple not capable of getting the same mileage with E85 as it does with 100% gasoline. There is less energy in ethanol (about 2/3 the BTU's as gasoline). No matter what the car salesman tells you, it can't be done. The Department of Energy has a great E85 calculator that tells you the mileage of your vehicle on E85 versus the mileage with Unleaded gasoline. You can figure out how much more ethanol costs you to burn. Yes I said MORE!

    http://www.eere.energy.gov/afdc/progs/cost_anal.php?0/E85/

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  7. Pennypincher, don't believe the sticker. I promise you that if the owner's of that car used a tankful of regular 87 octane fuel, they would have better fuel mileage than with the E85 given the same driving conditions. As for the computer, it varies from make to make, but it doesn't make any more than 10 miles for the computer to reset.

    Guy smylie, it wouldn't hurt to change your fuel filter while you're at it, especially if you have been running 85.

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  8. What gets really frustrating is that every time I fill up my car, I am putting money in the hands of the terrorists that are trying to destroy us. Do you find it a coincidence that as the price of crude oil went below $140/barrel that Iran fires off missels knowing full well that it will affect the price of crude? I think the terrorists know exactly how to get us, and the people that we are relying on to protect us, aren't.

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  9. Cory,

    A while back KSFY did a story on what type of gas gave you the best bang for the buck. Straight unleaded came out as the winner even though it does cost a bit more.

    Ethanol is great as an additive for improving air quality in the big cities, but it's not a "savior" fuel that will solve all of our energy problems.

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  10. One may debate whether new technologies or lifestyle changes will produce the greater overall savings.

    However, the Vulcan Science Advisory Committee tells me, and I quote, "The combination of new technologies and lifestyle changes will produce more savings than either measure alone."

    They ought to know. They've got the warp drive.

    ;-|

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  11. Wouldn't you think, though, that the money we spend on foreign aid to these not-so-friendly countries that have the oil, not to mention our military costs, would cost us MORE in the long run than using corn or even cellulosic ethanol?

    I think we have to look at this more in terms of energy, economic, and national security, in addition to lower costs.

    Supporting ethanol isn't perfect; no one said it will be. But isn't it better to send the money to our farmers (and perhaps get rid of the need for some federal ag subsidies), rather than to those who would do us harm?

    Considering how much oil we import, I'm curious how much the bottom would fall out on the market if we were to say "Nope, not interested!"

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  12. Well, Stan, there's no arguing with the Vulcans. ;-)

    A technical note: the study author factored energy efficiency into the cost estimate. He assumes a certain drop-off in efficiency, but says the average consumer still comes out ahead buying ethanol.

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  13. Farm subsidies are going from the farmers to the ethanol producers. I don't think the farmers are going to get any more help than will get them to vote for ethanol policy.
    If the stuff shortens the life of your engine, would that factor into the study? I think the study uses a lot of "if then" and 'the enviroment will be better' statements. The problem is you can use the 'enviroment' phrase and people will do ANYTHING!
    If you want to stop supporting terorists, get the EPA regulations off of domestic oil drilling. The only reason China and Venezuela are drilling off our OCS is that they are not following regulations.

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  14. I just went to the Department of Energy website that James provided. It said the average price of gas in our area was $3.41. I must be filling up in all the wrong places because the last sign I saw said $4.09.

    I don't know what car James was using as his basis when he said ethanol costed more, but I used the Chevy Impala as mine and it calculated it would cost $300 a year less to use E85, if you enter the average price of gas at $4 and the average price of E85 at $3. Not to mention it would prevent 3,875 lbs of greenhouse gas from entering the atmosphere.

    In response to guy smilie's post... the estimated amount of oil beneath ANWR would be enough to last about 300 days, and it would take 5-10 years before it could be ready. So people who propose this as a solution are using it as a gimmick to attract votes, nothing more. The OCS is a bit more viable, but again it would take 5-10 years to be available. As our refineries are currently running at 100%, we would have to increase our domestic refining capability too. Oil prices will presumably be much higher in 5-10 years, so even if we take the most optimistic estimates, it still will not lower prices below today's levels.

    The conservative side of this issue prides itself on saying speculators have little or no effect on the current price of gas. They say this is strickly a supply and demand issue. OK, I'll bite. World oil supply has been decreasing since 2005; we have probably reached peak oil. So while we may find small pockets to increase supply, the overall trend will be downward. Therefore we must decrease demand. Sorry Exxon Mobil, sorry Republican Party, we cannot drill our way out of this problem. I think drilling in ANWR and the OCS would lower the price of gas, but in 5-10 years we can do much more to lower demand by increasing efficiency and expanding alternatives.

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  15. For those who haven't had basic biology, plants need carbon dioxide for food. OK! They get the CO2 we exhale and we get the oxygen they exhale. I like that plan!

    I haven't seen E-85 at $3 in a long time. And I think E-10 hasn't reached $4 yet. So, you're really stretching the facts just like the ethanol board. And not just on ethanol.

    But, if we increase the supply to reduce oil prices and we aren't sending our money overseas, why would that be a bad idea?
    We are at peak oil production because the EPA won't allow repairs made to Oil refineries, derricks or rigs, we can't push anymore through the hole that's left. The 5-10 years of waiting is regulations. And we haven't bult a new refinery in 30 years. Look at how Hyperion is getting beat on, around here if you think oil companies are dragging their feet.
    Nobody really cares if some land is lost or if some people don't want it in their community, but if it's BIG OIL's fault, everyone is out for Blood.
    I think the oil companies drill and ship responsibly. We DO take care of our enviroment and if it's getting colder or hotter it will soon turn the other way. I have history to back me up here.

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  16. In defense of my other wrothy readers, Guy, I'll note that this weekend, E-10 was $3.89 in Madison; E-85 was $2.89. My wife says E-10 bumped up to $3.95 yesterday; I don't know about E-85. But $4 and $3 are reasonable ballpark figures around here.

    No big stretch, no harm, no foul—play ball!

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  17. OK. But what's the definition of average now?

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