E-85

[OwlCaboose2853]

ALTERNATIVE POWER: Michigan sets sights on ethanol to become an energy hotbed
State ramps up output of the automotive fuel
http://www.freep.com/apps/pbcs.dll/arti ... 6603290456


Nearly 100 years ago, Henry Ford proclaimed that ethanol would be the automotive fuel of the future.

The maker of the Model T and father of the modern automobile industry used a blend of ethanol and gasoline to power the car that put America on wheels. Ethanol is a grain alcohol produced from crops such as corn and soy.

A century later, ethanol remains an alternative energy source that has yet to capture the attention of the driving public or effectively compete with gasoline as a transportation fuel.

Gas prices are fast approaching $3 a gallon, which has ethanol producers in Michigan ramping up production in hopes of commanding a greater chunk of the state's energy portfolio.

The timing couldn't be better for Michigan producers because ethanol is now the fuel oxygenate of choice for most refineries in the United States after a fierce battle with methyl tertiary-butyl ether (MTBE). Oxygenates are chemicals added to gasoline to make them burn more efficiently.

Experts attribute much of the recent increase in fuel prices to the fact that refineries are switching their production from winter-grade gas to cleaner-burning ethanol-based summer grades. Refineries nationwide have stopped using MTBE and are switching to ethanol, which is more expensive to make.

MTBE has been found to contaminate drinking water, studies by the EPA show.

The ethanol trend is good news for Michigan, because it is expected to create hundreds of jobs and spur millions of dollars of economic growth in areas that choose to produce and distribute the fuel. A typical ethanol plant making 40 million gallons a year employs about 50 people.

"The energy crisis that has created the thirst for ethanol is that the government told the oil industry to clean up its emissions years ago," said Carroll Knight, owner of more than 100 gas stations in Michigan, Indiana and Iowa. "Ethanol production helps the balance of trade and helps farmers."

With growing uncertainty in the petroleum market and a national mandate to explore new areas of energy, the construction of at least four production plants could be a sign that Michigan plans to be a significant player in the creation of an ethanol corridor in the Midwest.

Michigan is among the nation's leading corn producers with more than 257 million bushels a year. The state has one ethanol plant in Caro, where Michigan Ethanol LLC makes 45 million gallons a year. But Michigan still is 11th in the nation in terms of overall production.

The nation's 97 ethanol plants produce 4.5 billion gallons a year.

Four plants -- Great Lakes Ethanol in Riga, Superior Corn Products in Lake Odessa, Andersons Inc. in Albion and Marysville Ethanol of Marysville -- are expected to come online within two years and produce more than 200 million gallons of ethanol a year combined.

"Michigan agricultural products can be part of many of the fuels of the future," said Mitch Irwin, director of Michigan's Department of Agriculture. "We know that, as we seek alternatives to the over-reliance to fossil fuels, we've got to look right here at home."

The state's $60.1-billion-a-year agriculture industry is a perfect starting point to ramp up investment in the biofuels area, Irwin says. Michigan has created 20 agriculture renaissance zones, which offer tax incentives for companies to build ethanol and other renewable energy facilities. "There is no question that ethanol is competitive and that it is already replacing some foreign oil," said Tony Simpson, general manager of Michigan Ethanol. "And I think Michigan is clearly on its way to creating a strong ethanol industry."

Ford Motor Co., the Chrysler Group and General Motors Corp. have invested hundreds of millions of dollars each on ethanol-powered, flexible-fuel vehicle technology.

Flexible-fuel vehicles can use conventional gas or an E85 blend (85% ethanol/15% gasoline). There are 4 million flexible fuel cars and trucks on U.S. roads today. Currently, all passenger vehicles sold in the United States can use the E10 blend of gasoline, which is 10% ethanol and 90% gasoline.

Detroit's automakers are betting that the E85 could become a viable alternative.

"We see a need for fuel diversity, and we're committed to the production of E85," said Curt Magleby, Ford's director of state government relations. "We think a reasonable goal would be to have 10% of all the gas stations in the country be able to offer E85 within 10 years."

Critics of ethanol say use of the fuel is not economical compared with the cost of conventional gas.

Wholesale prices for ethanol and gasoline, meanwhile, are similar, despite a 5-cents-a-gallon federal subsidy for ethanol. There is also the concern that E85-powered vehicles get between 5% and 10% lower fuel mileage than cars that run on conventional gasoline. In addition, ethanol-blended fuels are more difficult and costly to make for refineries, which some argue could offset any gains one might realize from using less petroleum.

"The petroleum industry is the largest user of ethanol, and we're supportive of it," said John Felmy, chief economist with the American Petroleum Institute in Washington, D.C. "There is no question it will play a role, but one must look at the numbers to figure out a realistic role."

Nevertheless, ethanol remains an alternative that is gaining a foothold with some consumers who look to contribute to the quest for alternatives to fossil fuels.

"I'm concerned about our country's dependence on foreign oil," said Catherine Proppe, a 41-year-old university student from Plymouth whose parents drive an E85-compatible vehicle. She said she would consider buying a flexible-fuel car the next time she is in the market for a vehicle.

[Railzfan]

Great news for us, the economy and the railroads! Hey, they’ll have to ship it in mass quantities somehow, probably in unit trains, maybe it will revive the railroad industry in Michigan. Seeing that E-85 is made form ethanol (which is made form corn, soy, etc.) we’ll never run out of it. The Middle East can keep their oil, I’ll gladly take something that is made here in the great USA! And it will create jobs, even more great news! I’m all for E-85!