Ethanol “Blend Wall” Remains a Concern, Says Purdue’s Tyner

As key players in the ethanol industry, corn growers need to be aware that the corn-based ethanol industry is very close to producing the 12.95 billion gallons specified in the Renewable Fuel Standard (RFS) for 2010. When that “blend wall” is hit, the EPA cannot require gas companies to blend more ethanol than they are legally permitted to blend, says Wallace Tyner, Purdue University professor of agricultural economics.

The ethanol industry is waiting to hear whether EPA will approve a waiver (that was submitted by Growth Energy and more than 50 ethanol producers last March) asking for an increase in the limit on the amount of ethanol blended in the country’s fuel supply from 10% to 15%. EPA must grant or deny this request by December 1, 2009.

Meanwhile, researchers from the National Renewable Energy Laboratory (NREL) and Oak Ridge National Laboratory are busily working with industry (including automakers, engine companies and oil companies) to evaluate mid-level ethanol blends.

An NREL report, Effects of Intermediate Ethanol Blends on Legacy Vehicles and Small Non-Road Engines, describes the findings from the first stage of a comprehensive study into how mid-level blends will affect emissions, vehicle performance and mechanical durability of conventional automobiles and small engines. The report is available at www.nrel.gov [3].

This study indicated that increasing ethanol content did not adversely affect regulated tailpipe emissions (hydrocarbons, nitrogen oxides and carbon monoxide). But, it did increase ethanol and acetaldehyde emissions.

The study also indicated that mid-ethanol blends may not be compatible with some small non-road engines because of their current control of air-fuel mixing. In addition, the study confirmed that adding ethanol to fuel leads to lower fuel economy because of the lower energy density of the fuel blend.

(NREL will continue to evaluate the impact of mid-level blends on emissions over the full useful life of vehicles, determining impacts on driveability and fuel specification standards and much more.)

Speaking of fuel economy, butanol has a higher energy content than ethanol, which would improve miles per gallon, Purdue’s Tyner says, adding, “Were it not for the distorted subsidy system, butanol would be more profitable.” Tyner adds that it is possible Congress could change subsidies to be based on energy content if the public objective is to improve miles per gallon. “The market would then decide which renewable fuels would allow us to do that best,” he says.

Butanol is classified as an advanced biofuel in the RFS2, and it receives a tax credit just like ethanol from the IRS as does methanol should it be blended into the fuel supply, says Robert Starkey, vice president, fuels, Jim Jordan & Associates (JJ&A), Houston, TX, a market analysis provider to the transportation fuels, ethanol and methanol industries.

“The reason that butanol is not used more today is that it is very expensive, and no one has developed a technology yet that can make it competitive with ethanol on a large commercial scale,” Starkey explains. “It is a very good fuel choice and may be where the fuel industry moves in the future should there still be a place for liquid transportation fuels (providing electric cars do not replace alcohol blended gasoline vehicles).”

Additional comments from Tyner and Starkey will be featured with several others in “Do Oil and Ag Mix?” which will appear in the October edition of Farm Industry News.