USDA Pushing EPA for More Ethanol in Gasoline

On Tuesday (Feb. 10), USDA Secretary Tom Vilsack urged EPA to increase the quantity of ethanol blended into gasoline from the current amount–10% ethanol per gallon–to some higher percentage, Reuters reports.

Will EPA heed Vilsack’s request or heed the clear implication of www.fueleconomy.gov, a Web site EPA administers jointly with the Department of Energy?

The EPA/DOE Web site reveals that filling up with ethanol is a big fat money-loser. To see for yourself, click on “Flex-Fuel Vehicles,” then click on “Fuel Economy Information for Flex-Fuel Vehicles,” and then click on “Go.”

EPA and DOE compare the average annual cost of using regular gasoline and E-85 (motor fuel blended with 85% ethanol) for 90 different flex-fuel models. In every case, regardless of make or model, fueling the vehicle with E-85 costs more than gasoline—lots more.

Consider a few examples:

Another neat thing about this site is that it compares the annual carbon footprint of using E-85 versus regular gasoline for each vehicle. In every case, ethanol has a lower carbon footprint (emits fewer annual tons of CO₂). This is controversial in light of research (see here, here, and here) indicating that ethanol is a net contributor to greenhouse gas emissions when you take into account emissions from fertilizer used to grow corn and the carbon released from forests and soils as corn cultivation expands into previously unfarmed areas.

Nonetheless, even if one eschews a lifecycle analysis and considers only the direct emissions released by burning equal volumes of gasoline and ethanol, the cost per ton of CO₂ avoided by using E-85 is ridiculously expensive.

Consider the Nisan Titan 4WD. According EPA and DOE, using regular gasoline, the Titan emits 13.1 tons of CO₂ per year; using E-85, it emits 11.1 tons of CO₂ per year. So fueling the Titan with E-85 instead of gasoline reduces the vehicle’s annual CO₂ emissions by 2 tons. However, the E-85 costs $2,259 more, which means the per-ton cost of reducing CO₂ by using E-85 instead of gasoline is $1,129.50. That’s a dozen times more costly than the “social cost of carbon” (how much damage each ton of CO₂ allegedly does) as estimated by Richard Tol, perhaps the world’s leading climate economist, in a major literature review.

For additional perspective, the Energy Information Administration estimated that emission permits under the Lieberman-Warner Climate Security Act (S. 2191) would cost $16.88 per ton in 2012, $29.88 in 2020, and $61.01 in 2030. So the per-ton cost of reducing CO₂ emissions by switching your Nisan Titan from gasoline to E-85 is between 18 and 66 times more costly than emission permits under Lieberman-Warner, a bill the U.S. Senate did not see fit to pass.

The EPA/DOE Web site demolishes claims that ethanol reduces pain at the pump or provides a cost-effective antidote to global warming. Yet the agencies established the Web site partly to promote E-85 and flex-fuel vehicles, and neither agency advises consumers not to use ethanol–quite the reverse.

So EPA will probably side with Vilsack against the clear implication of its own analysis that ethanol is a consumer ripoff.