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Ethanol Increases Consumers' Fuel Bills

It's Cleaner but More Expensive

By Joe Benton
ConsumerAffairs.com

February 21, 2006

Ethanol • Soaring Egg Prices Blamed on Costs of Fuel, Feed, Chicks • Chicken Prices Headed Up, Tyson Warns • Ethanol Gives Consumers Half a Loaf, Bakers Say • Ethanol-Blended Fuel Blamed for Boaters' Problems • Sales of Ethanol-Burning Cars Up 10% • How Green Can Your Drive Get? • Ethanol Producers Say Rising Food Prices Not Their Fault • Ethanol Driving Up Meat Prices, Congress Told • MIT Gas Saver: Ethanol Turbocharger • Ford Flex-Fuel Claims Challenged • Tests Find Ethanol Cleaner But Not Cheaper • Ethanol Lobbying Disclosures Questioned • Ethanol Benefits Questioned • Chrysler to Step Up Flex Fuel Production • Automakers Want More Ethanol Pumps • Ethanol Increases Consumers' Fuel Bills • Ethanol A Waste, Study Concludes • Ethanol Bandwagon Rolls on in the U.S. Senate

A gallon of corn fed E85 ethanol fuel is costing consumers more than gasoline even though the corn-based fuel carries less bang for the buck.

The U.S. Department of Energy says a vehicle has to use 1.4 times as much E85 as gasoline to go the same distance.

E85 is made up of 85 percent ethanol made from grain and 15 percent conventional pump gasoline. Throughout the country the price of E85 is higher than gasoline even though the corn-based fuel contains only 72% of the energy in a gallon of gasoline.

So while the heavily promoted alcohol fuel may reduce U.S. demand for oil and pour billions of dollars into U.S. agriculture, it seems E85 will increase motorists' fuel bills significantly as well.

This week E85 is selling for $2.19 a gallon while gasoline with 10% ethanol is $2.06. As a result, many Midwestern drivers are passing up E85 even though the corn based fuel is better for the environment and their local economy.

The Bush Administration has invested heavily in E85 from a political perspective. The President is promoting ethanol as a way to help reduce Middle East oil imports 75% by 2025.

Ford and General Motors plan to invest their capital in E85 as the companies help increase the number of E85 stations in the Midwest.

The two automakers intend to build as many as 600,000 vehicles this year with the special equipment needed to burn E85. About 5 million E85 compatible vehicles are already are on the road.

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