Gas Prices Too High? Well, E85 ethanol blend is 40 cents cheaper

GF Herald ^ | Mar. 21, 2004 | Lisa Davis

[The Great RJ]

Ethanol production on the Great Plains wouldn't exist without massive government subsidies. Ethanol also isn't as efficient a fuel as gasoline--you won't get nearly as far across the N.Dakota prairie with a tank of 85% ethanol as one of gasoline. Yes ethanol is clean burning and locally produced, but it doesn't make any economic sense and isn't a serious solution to our dependence on foreign oil.

[templar]

Or we could try the radical concept of eliminating stupid spending that government shouldn't be doing ...

Not a bad idea, except that stupid spending fuels a large part of the economy. Cut it and the economy collapses before things can (hopefully) adjust to something else. Road building alone won't make up for the loss of government provided money in other areas of the economy,; only so many roads are needed and anything beyond that gets back into the area of stupid spending. Fuel tax seems to be one of the only (maybe the only) tax that actually end up being used for what it is supposed to be used for.

[IronJack]

I believe that Brazil has been burning a 90-10 mix of ethanol-gasoline for decades now.

[rellimpank]

----as an aside, I recall that a few years ago, the redoubtable EPeffingA cracked down on bakeries, as the delicious smell associated with baking bread is actually caused by ethanol from the action of the yeast--"polluting" our precious atmosphere---

[Fee]

E85 is not competitive because there is no demand for it and it is not mass produced. But using it means we can reduce gasoline demand by 85 percent in cars, trucks and etc. Unanswered question is how much energy was needed to produce E85. If the next twenty years, most cars and trucks have this alternative fuel capability (that should be mandated by government for national security reasons), we might have a growing demand for E85, then mass production will occur and the cost to produce the product drops to a point it will not need subsidies. If successful, the strategic implications are massive. The Arbs and Venezuelans will not hold us hostage. When China, and Eastern Europe starts to develop economically, their people will start to buy cars, and those cars will need gasoline. The US can become a source for them (our farmers, refineries and etc will benefit). In a time of war, this product will allow our society to function.

[Eric in the Ozarks]

Someone said burning alcohol produces NOX or some damn thing...

[rellimpank]

---come to think of it , I wonder what is the feedstock from which all that anhydrous ammonia used to fertilize corn originates?

[Eric in the Ozarks]

Natural gas, mostly.

[WOSG]

Does that cost take into account the TEN BILLION dollar Ethanol subsidy the Govt gives to ethanol producers?

[WOSG]

"The solution is not to buy ethanol, it is to reduce taxes on gasoline to the same level levied against ethanol."

"That just means paying more taxes elsewhere to make up for the loss and pay for roads and such."

I know you didnt mean it this way, but the "paying more taxes elsewhere" is right, in the sense that we pay the OPEC tax.

OPEC is an unusual cartel - it's the worlds' only economic cartel that is a cartel of Governments. What the govts in effect do with their royalty methods of skimming oil profits is to TAX OIL PRODUCTION. Well, we should shift that money from going to Saudi pockets to going to American pockets.

Here's how: We should have higher gas taxes and have an oil import fee. Why? Because right now the money goes to OPEC, but if we tax on top, the price will go up, which will pinch demand, which will rebalance OPEC to force them to cut the price. In effect, we could increase the share of the cost that goes to our Government. Now this will affect marginal demand and supply, but if we were smart, we'd go to OPEC and basically tell them "Keep your prices low or we are going to tax oil use away".

[WOSG]

" If the next twenty years, most cars and trucks have this alternative fuel capability (that should be mandated by government for national security reasons), we might have a growing demand for E85, then mass production will occur and the cost to produce the product drops to a point it will not need subsidies."

There is no 'cost to produce' price reduction in store for E85. It takes more energy to make this stuff than you get out as usable energy.
It is an INHERENTLY INEFFICIENT ENERGY SOURCE.

[SauronOfMordor]

Combine that 52 cents credit, with the absence of the approx 50 cents/gal federal and local taxes, plus the fact that ethanol produces much less energy, and the per-mile cost of driving with ethanol will be much higher, taxes and energy being equal

[P.O.E.]

"Is This Trip Really Necessary?" is considered quaint now, I suppose.

[TMSuchman]

We also must remember that we have a very limited refining capicity, thanks to the enviro-wacko's, and NIMBY [not in my backyard] types, laywers ect...

I do not have any new ideas on how combat this threat at this time. Maybe look back a Teaslea?

[Libertarianize the GOP]

ping

[farmfriend]

Rights, farms, environment ping.
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[E.G.C.]

BTTT!!!!!!

[GraniteStateConservative]

Yeah, corporations will let our government tax oil use away. I'll have what you're drinking.

[Smokin' Joe]

Ironically, North Dakota is an oil producing state also, but oil production does not depend on rain.

The same states which comprise the grain belt would be most adversely affected by prolonged drought. Think dust bowl.

I would be surprised if there isn't some attempt here to find a market for Genetically modified strains of corn (Starlink et.al)which foreign importers won't touch, and which (in at least one instance I know of) have produced severe reactions in humans.

Ethanol also absorbs water, and I wouldn't want to be stranded anywhere in North Dakota in the winter with an iced up fuel line.

I don't understand burning food for fuel when farmland is a diminishing and generally non-renewable resource.

Before anyone turns on the flames, keep in mind that chemicals will keep farmland productive for a while, but (especially in states like North Dakota) wind erosion eventually removes the topsoil base. Only good conservation practices will keep the soil useable.

[Smokin' Joe]

Tax the imports, inflate the price of domestic oil, and increase domestic exploration and production. The reason our domestic industry is not doing nearly as well as offshore efforts (aside from occasionally insane regulation) is that the same price cycles which have people smiling at the pumps one year ans whining the next affect the exploration industry here at home. If you put two million or more in drilling an oil well, you would like to get a return on that investment. Some do not find oil, but the rest are at the whim of a market which has had crude oil prices everywhere from $8 per barrel to $38 for the same oil in the last 5 years.

By taxing imports and not domestic production, this would stimulate drilling for oil right here at home. But save it for an off year, when crude prices are low.

BTW, ND is the nation's # 8 oil producing state, with about 80,000 barrels of oil per day produced.

Tax gas at the pump, and you don't stimulate domestic production, just make fuel cost more for everyone without doing anything to remedy the real problem.