Renew Energy - Renewable energy for the world

Why Ethanol?

Good for the Environment
Good for the Air – Using ethanol dramatically reduces harmful tailpipe emissions. According to the EPA ethanol reduces Greenhouse gases by 29%, reduces toxins by 40%, VOCs by 15%, Carbon Monoxide by 40%, Fine Particulate Matter by 50% and Sulfates by a whopping 80%.

In 2006, ethanol use in the United States reduced Greenhouse Gases by 8 million tons – the equivalent of removing 1.2 million cars from the road. As more and more corn growers adopt conservation tillage, greenhouse gas reductions will reach 40%.

Good for Water Use
Although it takes 2.7 gallons of water to make a gallon of ethanol, it takes an incredible 92.5 gallons of water to produce a gallon of gasoline! As Canadian tar sands come on line, this water use number for gasoline will increase dramatically. Extracting oil from tar sands uses much more water and emits 300% more in Greenhouse Gases.

Good for Energy Conservation
To get 100 btus of energy from ethanol, you need to input 74 btus creating a positive energy balance. However, for gasoline, to get 100 btus of energy, you need to input 123 btus making it energy negative!

As ethanol producers look to the next generation of technology, many will be converting from natural gas to biomass to meet their plant’s heat and electricity needs. This will further reduce America’s fossil fuel needs.

Cars today run on E10 with no noticeable reduction in gas mileage. For E85, American cars are factory designed to burn mostly gasoline (because of the relative unavailability of E85 at the gas station). Therefore, you can expect to see about a 15% reduction in gas mileage when using E85. However, Saab has developed an engine in Europe that burns E85 with no loss in mileage!

Also, recent studies show that E20 or E30 may be the optimum blend, actually increasing gas mileage and causing no harm to the average auto fuel system. More testing needs to be done before this blend will be certified for the traditional auto engine.

Good for the Soil
This isn’t your father’s corn field! Today over 55% of corn growers use conservation tillage, 77% use crop residue management. Only 23% use a plow to work their fields. This has reduced soil loss by 90%!

Also farmers have reduced nitrogen fertilizer use by 17%/bushel in the last 15 years alone. Phosphorus use have declined 28% and pesticide use is down by 81%!. All the while yields of corn/acre have skyrocketed – 1947 it was 40 bushels/acre, by 1972 it was 72 bushels/acre and 25 years later we are up to 160 bushels/acres. Almost ALL the growth in corn production has come from increased yields, almost NONE from additional corn acres.

2007 did see an increase of 15.3 million acres of corn planted, but ALL of this increase can be accounted for by an equal DECREASE in soybean and cotton acres. In other words, NO net increase in farmland and NO plowing up previously unfarmed land occurred in the United States last year.

Good for Consumers
Ethanol keeps Gas Prices Down – According to Merrill Lynch, oil and gas prices would be about 15% higher if ethanol producers weren’t increasing their output. This would add about 50 cents to every gallon of gas purchased! As Wisconsin alone consumed 3.5 billion gallons of fuel, that’s $1.75 billion in savings for the Wisconsin consumer.

Ethanol is a better value than gasoline – Current pricing shows that ethanol is averging about $1.00/gallon less than gasoline at the wholesale level. In many states, this savings is passed on directly to the consumer in the form of E10 prices 5-10 cents less than traditional gasoline.
In Wisconsin, you can see the price differential in the pricing of E85 at fueling stations. Our E85 is priced between 75 cents and $1.00 less than traditional unleaded.

Despite alarmist rhetoric in the media, there is little correlation between ethanol production and the rising price of food. Corn prices are being driven much more by world demand as China and other nations eat more meat (livestock feed is the number one use of corn). The price of wheat and other food stock is also rising and has NO relationship to corn use at all.

Also, very little of your food dollar goes to the farmer – less than 19 cents of every dollar you spend at the grocery store. Food prices are much more sensitive to increases in energy costs, which ethanol is helping to restrain.

Good for the Economy
The average new ethanol plant producing 100 million gallons of ethanol per year has a tremendous economic impact on its community.

$150 million is capital construction investment
$70 million to local economy during construction phase
$233 million in local economic impact per year once in operation
45 direct new jobs, 101 indirect new jobs – average annual salary at a typical plant is over $50,000
Household Incomes in community raised by $7.9 million annually
Corn prices within 40 miles raised by 10 cents/bushel
Local Tax Revenues increase by $3.2 million

Ethanol has had a very positive impact on the American Economy. In 2006, the 5 billion gallons of ethanol produced in the United States displaced 206 million barrels of oil – more than we import from Iraq!

This production reduced our trade deficit by $13 billion dollars. The United States currently imports 67% of its crude oil at a cost of $300 billion, representing 40% of our trade deficit. Every dollar spent on ethanol reduces the effect of exporting our dollars and jobs, often to nations that are not exactly our friends.

In 2007, ethanol put $6.7 billion in the pockets of Americans, and added $4.9 billion to federal, state, and local tax coffers.

The question is often raised about why ethanol receives a “subsidy”. Actually, ethanol producers receive no direct subsidy! There is a 51 cent/gallon tax credit that goes to “blenders”, the people that mix and market the gasoline to retailers. This is a sort of a “bribe” to encourage oil companies, who are often hostile to ethanol, to use the product. Ethanol producers still find many retailers that would like to have ethanol-blended fuels, but are prohibited by their contracts with gasoline wholesalers from selling biofuels.

The tax credit was also meant to be passed on to consumers so as to encourage consumption of American made ethanol. Unfortunately, this is not always the case. Many blenders receive the tax credit, but do not pass on the savings to the retailers. E85 stations DO pass the blender credit on directly to the consumer.