Many people have high hopes for ethanol made from corn–that it will prevent future gasoline shortages, prevent global warming, be a wonderful investment, and improve the income of farmers, among other things. Other observers raise a whole host of concerns including scalability, impact on the environment, and impact on food prices. Why is there such a huge disparity in views? What is the real promise for corn ethanol?
1. Why don’t we see more stations selling E85 (85% ethanol/15% gasoline mixture)?
In 2006, about 20% of the US corn crop was used to produce ethanol. Even with this huge share of the corn crop, US corn-based ethanol amounted to only about 3.5% of the US gasoline supply by volume, and 2.4% of the supply by energy contribution.
Even if all the corn-based ethanol that was produced were used as E85, there would not be many gasoline stations selling E85. In fact, only a very small portion of the corn ethanol that is produced is used to make E85 — the remainder is used as a fuel additive, in concentrations up to 10% of the gasoline. Continue reading