As gas prices keep rising, retailers profits pinched
Six months ago, ethanol was hard to come by in Chattanooga. Now motorists don’t have to look far to find gasoline blended with the corn-based fuel.
“Now 75 percent of gas in Chattanooga has ethanol,” said Ross Benton, president of Benton Oil Co., which is distributing E10 gas containing 10 percent ethanol.
The push for ethanol is at a fever pitch as political leaders nationwide look for domestic replacements for foreign oil. President George W. Bush signed the Energy Independence and Security Act in 2007, which mandates that all gas consumed in 2014 contain 10 percent ethanol.
The Tennessee Department of Agriculture requires labels on every pump in the state that contains ethanol, said Randy Jennings, biofuels administrator for the department. It’s an alert to consumers, he said, but the risk to vehicles is negligible, the fuel economy is nearly identical and the gas blend burns cleaner.
Still, some people question whether corn-based ethanol is a responsible choice.
“The production of corn ethanol is subsidized by state and federal governments to the tune of more than $6 billion a year,” said Dr. David Pemental, a Cornell University professor and outspoken opponent of ethanol use. “The subsidies for a gallon of ethanol are more than 90 times the subsidies for a gallon of gasoline.”
Staff Photo by Dan Henry -- Soddy-Daisy resident Neville Lewis carries a gas tank he just filled to his fishing boat while at the On The Run Mobil gasoline station off Hixson Pike. The Mobil station switched over to carrying ethanol-blended gasoline just over a month ago.
Dr. Pemental argues there are a variety of concerns about ethanol:
* Corn production causes massive soil erosion.
* More than 1,700 gallons of water are required to produce 1 gallon of ethanol.
* If the entire U.S. corn crop were used for ethanol, it would fill only 7 percent of the country’s need for gas.
* Growing, harvesting and delivering corn to ethanol refineries requires nearly as much fuel and energy as the end product produces.
* The prices of meat and dairy products have risen sharply because supplies of corn, used for livestock feed, are being pinched by ethanol production.
On the other side of the argument, proponents of ethanol say the technology for making it is improving all the time, according to data from the Renewable Fuels Association, the ethanol industry’s trade association. And using corn to make ethanol is not the main reason for rising food prices, association spokesman Matt Hartwig said.
“It is indeed true that corn prices are higher, but the major culprit is energy prices,” he said.
Cows, chickens and other livestock feed on corn, so when the price of corn rises with demand so does the price of meat, eggs and milk, Mr. Hartwig said.
“The price of crude oil has twice the impact compared to the price of corn. Plain and simple: Corn prices are not the sole reason, or even the major reason, for marginally higher prices on the grocery aisle today,” he said.
Mr. Hartwig said poor harvests and global demand for corn also have contributed to higher prices.
The Renewable Fuels Association cites studies that show ethanol producers over the last five years have reduced their water use nearly 27 percent, reduced electricity use nearly 16 percent and reduced total energy use nearly 22 percent.
A SWITCH
The position of the Sierra Club, a national environmental group, is that corn-based ethanol has laid a good foundation for other plant-based fuels such as switch grass and wood-based fuels. Both are being studied in Tennessee and Georgia, said Josh Dorner, a Sierra Club spokesman.
“There are a lot of problems with the way we are producing corn ethanol,” Mr. Dorner said. “Other sources are not as wasteful and lend to a more efficient process.”
Switch grass, which has been propped up with aggressive studies at the University of Tennessee, can be regrown every year after it’s mown down, Mr. Dorner said. Corn, however, must be replanted, depleting the soil and contributing to fertilizer run-off, he said.
About 720 acres of the grass have been planted in Tennessee, including a farm in Bradley County and another in Polk County, said Dr. Kelly Tiller, director of external operations at UT’s office of bioenergy.
“Corn has been the first generation in technology,” Dr. Tiller said. “There are other new generations, a second and third generation, that will allow us create a more sustainable form of biofuel.”
Using a variety of sources, including corn, probably is a better solution, said Dr. Tiller.
Mr. Hartwig agreed.
“Frankly, we are going to need everything we can to solve our energy crisis,” he said. “We’re just laying the foundation for the future.”
TRUCKING AHEAD
Mr. Jennings said the Tennessee Department of Agriculture steers clear of politicized arguments, but the agency, with the help of federal grants, is encouraging more gasoline stations to sell ethanol. The gas blend creates less pollution and could reduce fuel prices, he said.
Along with E10, the only other type of ethanol-blended gas now available is E85, which uses 85 percent ethanol and 15 percent gas. Any car can run on E10, but E85 only runs on specialized Flex Fuel vehicles. There is no E85 pump in the Chattanooga area, he said.
“There aren’t many E85 pumps in the state right now, maybe just 12 in all of Tennessee,” Mr. Jennings said. “We’re encouraging a greater network of those,” particularly along the interstate corridors, he said.
E10 gas might cause some motorists to see a reduction in fuel economy, but Mr. Jennings estimates the loss is around 2 percent, which he insisted hardly is noticeable.
“Consumers should know that we have inspectors that pull roughly 8,000 samples of fuel all across the state every year,” Mr. Jennings said. “We’re concerned about ethanol blends, and we’re doing everything we can to make sure it’s safe for vehicles.”
