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Missouri Governor Signs State Renewable Fuels Standard: 10% by 2008

5 July 2006

Staterfs_5jul06
Dark green marks the states with enacted RFS and light green the states currently in legislative process.

Missouri Gov. Matt Blunt today signed House Bill 1270—the Missouri Renewable Fuels Standard (MoRFS)—requiring gasoline sold in Missouri contain 10% agriculturally-derived ethanol (E-10) by 1 January 2008. (Earlier post.)

The legislation lifts the E-10 standard when ethanol is more expensive than petroleum-based gasoline. Consumers will also continue to have a choice when they buy gas, as premium grade fuels will be exempt from the E-10 standard.

Missouri currently has three operating ethanol plants, in Macon, Malta Bend, and Craig, that produce about 115 million gallons of ethanol annually. A fourth ethanol plant in Laddonia will begin operations later this year.

The Missouri Corn Growers Association (MCGA) expects ethanol production in the state to reach at least 350 million gallons by 2008, surpassing the 280-million gallon market that would be created by the MoRFS. In 2003, according to data from the Federal Highway Administration, Missouri used a total of 88 million gallons of ethanol in various gasoline blends.

The first four ethanol plants in Missouri will consume approximately 55 million bushels of corn annually and raise the value of Missouri’s corn by $41 million at the farm level annually. Estimates indicate that farmers can expect a five to fifteen cent per bushel price increase for corn as the demand for ethanol increases.

July 5, 2006 in Ethanol, Policy | Permalink | Comments (21) | TrackBack (0)

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Quite interesting. Addition of alcohol substantially increases octane rating of gasoline. Here in Western Canada Mohawk/Husky brand sells exclusively alcohol blended gasoline, and the lowest octane number they are offering is 90 (RON+MON)/2 for the price of regular 87 on other gas stations. I bet with 10% alcohol Missouri’s octane would be at least 92 – which make it premium.

I am not surprised that a state that produces corn will legislate a market demand for it. I am surprised that they will require people to buy a product that will give them lower miles per gallon. Even though they claim a user can choose non ethanol gas if they buy premium, that is saying if you want to get the mileage used to get, you have to either buy more inferior product or pay more for what you use to get.
Ethanol as a fuel for cars and trucks is another profit driven diversion tactic by the US auto industry and corn farmers to avoid having to move to alternative fuels or hybrid vehicles.
With ethanol, all we do is increase the price of corn through increased demand, so that the real cost of driving is increased in a way not directly seen at the gas pump. Corn is used for so many food products and feed for livestock, that this extra demand will impact consumers with a cost of living increase for food on top of the rapidly increasing cost of gasoline.

The way to get the cost of gasoline down is to buy less of it because you have a vehicle that doesn't need any or much of it. Also support legislators that favor renewable and alternative fuels.
Don't fall for the gimics of ethanol.

I wonder if the energy balance would improve if they were making butanol from corn instead.

1)Isn't ethanol an alternative fuel? 2)Ethanol has 6% less energy per gallon than gasoline. Blended 10% with gas, as in E10, that means that a gallon of E10 contains .6% less energy. 3)One of the gimmicks of ethanol is it's reduction in net greenhouse gas emissions. So, by having to buy .6% more product (at a reduced rate; usage of E10 would be suspended if it's price goes over that of mineral petroleum) you are reducing your net GHG emissions by 10%, and that is a start.

...oh yeah, national energy security, non-renewable resource conservation, an improved balance of trade with the OPEC cartel, relief to the poverty that farmers tend to face, and the fact that those domestic farmers will probably spend all that (hard earned) money on goods and services right here in this country, are all good things too!

"Ethanol has 6% less energy per gallon than gasoline."

Not according to the EIA.

Ethanol: 84,000 BTU/gal
Gasoline: 125,000 BTU/gal

That is 32.8% less energy per gallon.

http://www.eia.doe.gov/aer/pdf/pages/sec13_1.pdf


This is reflected in the EPA mpg ratings for E85 vehicles at fueleconomy.gov. For example the Chevrolet Imapala is rated at 21/31 on gasoline and 16/23 on E85.

Almost none of these Ethanol laws have teeth. They (nearly) all only go into effect if (a) it's cheaper, or (b) there's enough in-state production, or both.

(a) If Ethanol were cheaper, the gas stations would be rolling it out anyway. Competition and capitolism guarantee it. No law needed.

(b) The conditions for (b) isn't going to happen unless the conditions for (a) happen for a long enough period of time.


These laws, while possibly leading to effective laws in the future, have no teeth. Their "out" clauses are so easy to qualify for that they will have no influence on behvaior.

The conclusion that this reduces GHG by 10% is absurd. That assumes that zero inputs of fossil fuels were required to produce and distribute the ethanol. Whereas there is a continuing debate on EROIE, there is no debate on whether or not fossil fuels are required as inputs. There is no free lunch, folks, and in this case, lunch, especially if it involves processed corn, may get very much more expensive.

Note that ADM's new plants will use coal to produce ethanol. Yeh, this is a green fuel.

We can end this debate if we agree to tax on carbon inputs regardless of the fuel produced. Let the marketplace decide. The ethanol industry and its legislative lackeys are trying to circumvent the debate by stuffing ethanol down people's throats. Nice. They're going to allow people to buy Premium for cars that only require regular. Dumb.

Andrey -

regular gasoline is a mixture of straight-run light distillate and isoalkanes plus aromatics from hydrocracking middle and heavy distillates. The cracked products raise the octane number. When alcohol is blended in, the quanitities of hydrocracking products is simply reduced and more of the middle distillates go into diesel fuel.

t -

you are correct. Even in the best of cases, a gallon equivalent (i.e. corrected for energy density) of corn ethanol requries ~0.8 gallons of fossil fuels to support the agriculture. Some claim it's even more marginal. That doesn't mean ethanol and other biofuels are intrinsically bad, just that corn is a poor feedstock. Of course, midwestern politicians have seen to it that midwestern farmers receive subsidies for growing corn, not for capturing carbon.

Ethanol from coal makes little sense but then neither does a protectionist tariff of $0.54 per gallon on imported ethanol (which ADM secured via intermediaries). Butanol does not enjoy this protection, which is why it will likely be brought to market in the UK first. The Brits used butanol in Spitfires in WW2. I suspect they produced it from coal but I'm not certain of that. The new venture by BP and DuPont will produce it from sugars, which they claim they will extract from cellulose in the future.

Rafael:

Yes, and I bet it is happening in Europe due to increasing demand for diesel fuel. Here in US/Canada gasoline is in overwhelmingly higher demand and refineries have to crack or reformulate high portion of middle distillates anyway. My point is that expensive ethanol is better to be used to increase overall octane of regular gasoline, not for E85. It is a shame to have the lowest octane regular gasoline among developed countries. Waste of precious oil.

Knock in gasoline engine due to lower then recommended fuel octane does not take place in cold weather, at higher elevation (couple of entire states in US), or at partial throttle and low rpm. Modern powerful computers managing gasoline engines sense beginning of detonation and make adjustment to spark advance to eliminate knock. Max power suffers, but other vice engine is happily (thought little noisier) running on lower octane fuel with same efficiency (theoretically even higher). So, conversion to higher compression engines and higher octane gasoline could be gradual and trouble-free.

Corn derived ethanol is a marginal solution at best, but it is hardly the biggest boondoggle out there. At best, mandates and policies such as the one seen here help lay the groundwork for the wider use of efficiently derived ethanol in the future -- sugarcane feedstocks from the south or cellulostic feedstocks from the rangelands, as the enzymes to produce them continue to improve. It also leads to better combustion and cleaner exhaust, which is admittedly critical only in larger urban areas and smog-prone zones.

At worst, it amounts to another farm subsidy, on top of all the others coming out of our taxes. This one, however, people can opt-out of to a certain extent, by consuming less fuel, or buying higher grade gas if they're feeling vindictive.

As to the argument that this mandate has no teeth because of the outs -- that is not necessarily true. That argument requires the assumption that given a competative bulk price for ethanol, all fuel merchants will blend in the ethanol to save money. But given a slighly cheaper bulk price for ethanol, transporting it and blending it at the terminal might be expensive enough to discourage companies from using it. Other hang-ups include hesitating to be the first on account of shouldering any start-up or infrastructure costs, as wells marketing or image concerns ("Don't by Brand X -- you'll get slighly worse mileage. Instead buy Brand Y"). Name brand gasoline still commands a premium over "spot-job" independent gas stations, due partly to convenient locatinos and partly to image and marketing. A few cents here or there don't make much of a difference to consumers.

By creating a uniform standard, all players share the startup and infrastructure costs, all players are guaranteed a uniform field on which to compete in this respect, and petroleum companies might sometimes be required to add ethanol even at moments when there is no cost savings of the sort that would tempt them to do it naturally.

The other boogeyman is the idea that widespread corn-based ethanol consumption will seriously affect the price of food. It won't. The cost of raw corn is a substantial fraction of the cost of a gallon of finished ethanol -- something like $1 out of the $2.50 or so that a gallon of ethanol goes for when we are not supply-constrained. On the other hand, corn price is a small fraction of the retail price of corn-derived food products and meat. A doubling of the price of bulk corn -- influenced by growing fuel demand, say -- will likely push the cost of producing ethanol so high that mandates like these will be suspended. Meanwhile, the doubling of the price of corn will raise the price of a bag of corn chips from $2.00 to $2.10. Because of the expense, we'd switch back to other fuels or simply drive a whole lot less before we forced the price of food up to problematic levels.

More serious are the observations that ethanol requires energy inputs on the farm side and distillation side, that we could be having it cheaper right now but are not because of protectionist tariffs, and that other alternative fuels are much more useful but are being shunted aside because of poor policy planning. But ethanol remains a good way to reduce imports, clean up city air, and get something useful out of our farm-subsidy dollar.

If the energy inputs required in ethanol production can be made clean or renewable, we all gain. By concentrating fossil-fuel usage a one point source (the power plant running the distillery), we can more easily track the pollution it creates, implement the most efficient generating technologies, and control its impacts more readily than when we burn an equivalent amount of fossil fuels in thousands of small engines dispersed around the environment. That's the hope, anyway.

Like most of you, I support more means-neutral approaches than what we typically see adopted. Use mandates and taxes to encourage the outcomes we need without getting too hung up on the details. If you want to specify a renewable-fuel standard, specify a certain volume of renewable or agriculturally-derived fuel, and let the market decide if ethanol or butanol is the way to go. If you are worried about city air, require an oxygenate and let the refiners figure out which one is best. If you are worried about global warming, implement a comprehensive carbon tax, which would hit the fossil fuel inputs when the enter the supply chain, instead of mandating corn-ethanol here or soy-biodiesel there. But all the same, I would not utterly condemn a mediocre but somewhat positive step just because it was not the best step.

Those BTU figures are WAY, WAY OFF! Gasoline is only about 112,000 BTU/gallon. 100% pure ethanol is closer to 77,000 BTU/gal. Only diesel can touch the 125,000 BTU/gal range, with some diesel mixes close to 130,000 BTU/gal.

Jens Riege

I agree with you. Feeding our current gas guzzlers with Ethanol, Butanol or other bio-fuels instead of liquid fossil fuels is NOT an acceptable solution. This switch, if done on a massive scale, will compete with food production, still use a lot of fossil energy and have negative environmental effects.

We have to move away from ineffcient ICE machines and use less or no liquid fuels.

The path to more efficient electrical propulsion with PHEVs and eventually EVs is much more promising and should be promoted more actively. More should be done to develop better/cheaper on-board EES devices. Producing and distributing more clean electrical power is not a major problem. Using energy from the wind-sun-waves etc., is doable at a reasonable cost.

Aren't the states with too much smog/ozone required to put E10 to meet the Clean Air Act? If so, wouldn't the above map be even greener?

The oxygenate pollution-control requirement is a federal requirement, not one enacted by states, and that map only represents state laws. Furthermore, from what I know, federal pollution reduction mandates operate in specific at-risk regions and cities, not throughout entire states. Most rural areas would never come close to having a regulation requiring their gas stations serve up E10 as a pollution-control measure, but in the states noted on the map, biofuel mandates extend pretty much evenly throughout the territory.

Well, if everyone is whining "no, don't use our food for fuel", why don't we switch over to something else like wood or algae to get the ethanol?

Mark R. W. Jr.:

I have no problem if they use switchgrass or other plant waste material to produce ethanol. I think that would make good use of the waste as long as it doesn't take more energy to create ethanol than ethanol puts out.
But if we use wood, will the world have enough waste wood, and if not waste wood, live trees to support ethanol production? And what would that do to lumber prices? Do we as consumers want to see housing costs go even higher because we use wood for fuel as well as building materials?
Algae would work as long as we don't need to consume tons of water to produce the ethanol. Water will be/is already in short supply, especially in developing contries and would not permit sufficient volumes of algae growth to be used for fuel.
In any case, no matter what the fuel source, the gasoline demand is so high that it would strip any and all non renewable resources to the point that we will end up paying for it at some point in the economic chain. Plug in Hybrids with electricity from Solar or wind provide the most cost effective option as a replacement / gradual phase out of gasoline.

Harvey,
PHEV and BEV hold great promise, but also have disadvantages that must wait for more technological breakthrough such as cheap and durable battery. For now, amortized battery cost will be a lot higher than aggregrated petrol cost, your car will be several hundred pounds overweight, your trunk space will be gone, and you may have to replace the battery during the car's lifetime, to the tune of $5000-10,000 USD. In hot climates, you battery definitely will not make it even 1/3-1/2 the life of your car. In cold climates, your battery won't deliver the power nor the charge capacity. We have been waiting 100 years for better battery technology to come along, so I'm not holding my breath.

Why not just run your car (ICE-electric hybrid) locally with H2 for a range of 120mi that requires only a few minutes of fill up time, or fill it up with CNG for a range of 360mi, your choice? Without excess battery weight and you still have your trunk space, and the fuel tank will last for the lifespan of your car? No need to worry about extreme temperatures degrading your battery storage capacity.
Someday, solar H2-ICE-hybrid car will have comparable solar to wheel efficiency as a BEV or PHEV as H2 production from hi-temp electrolysis will get much more efficient than today's cold electrolysis, and H2 will have cost comparable today's gasoline. Meanwhile, derive your H2 and methane from gasification of cellulosic biomass at far higher efficiency than cellulosic ethanol.


Were doing a bill on ethanol

Were doing a bill on ethanol

Affect food production, bull.
Do you have any idea how many acres of good farm land sit idle because of federal government payments to NOT produce anything on the land. If alll that land was put into production we could produce exportable amounts of both ethanol and biodiesel (which is a better power producer & lubricant than fossil fuel diesel). I wish that all the land that people get paid to not farm would get back into production and they would lose the handouts for not farming.
I have lived nearly my entire life in rural areas and still cannot stomach anyone getting paid to not work for what they get.
I'm not talking about huge farming corporations, I'm talking family farms that have received hundreds of thousands of dollars for letting the land sit empty, there are very few hard working poor farmers left out here, many of the most wealthy people around me are the farmers, some from hard work, but others much from government subsidies, handouts and tax incentives.
In Missouri we have had gas with 10% ethanol for many years on a small scale and I welcome it's increased use & hope that there will be higher requirements for both ethanol and biodiesel.

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