Mileage (mpg) Using Ethanol Seen 20% Higher Than EPA Says - Bloomberg

[Bill USA]

41. If you were working at EPA or Dept of Energy you would be falling over Oil industry lobbyists all

time. This is a rather big subject which really deserves a thread of its own but I'll give you a couple links to articles in the press that touch on this:

Big Oil's Big Stall on Ethanol - BusinessWeek

http://www.businessweek.com/stories/2007-09-30/big-oils-big-stall-on-ethanol

Those who criticize the industry's stance see it as reminiscent of its attempts to discredit the theory that human use of fossil fuels has caused global warming. Mark N. Cooper, research director at the Consumer Federation of America, authored a recent paper characterizing the situation as "Big Oil's war on ethanol." The industry, he writes, "reacted aggressively against the expansion of ethanol production, suggesting that it perceives the growth of biofuels as an independent, competitive threat to its market power in refining and gasoline marketing."

The industry collects the subsidies, but didn't lobby for them—Congress created them to encourage a larger ethanol market. While oil reps say they aren't anti-ethanol, they are candid about disliking E85. Says Al Mannato of the American Petroleum Institute (API), the chief trade group for oil and natural-gas companies: "We think [ethanol] makes an effective additive to gasoline but that it doesn't work well as an alternative fuel. And we don't think the marketplace wants E85."

One prong in the oil industry's strategy is an anti-ethanol information campaign. In June the API released a study it commissioned from research firm Global Insight Inc. The report concludes that consumers will be "losers" in the runup to Congress' target of 35 billion gallons of biofuel by 2017 because, it forecasts, they'll pay $12 billion-plus a year more for food as corn prices rise to meet ethanol demand. The conclusions are far from universally accepted, but they have been picked up and promoted by anti-ethanol groups like the Coalition for Balanced Food & Fuel Policy, made up of the major beef, dairy, and poultry lobbies. Global Insight spokesman Jim Dorsey says the funding didn't influence the findings: "We don't have a dog in this hunt."



Academia plays a role as well. There is perhaps no one more hostile to ethanol than Tad W. Patzek, a geo-engineering professor at the University of California at Berkeley. A former Shell petroleum engineer, Patzek co-founded the UC Oil Consortium, which studies engineering methods for getting oil out of the ground. It counts BP (BP), Chevron USA, (CVX) Mobil USA, and Shell (RDS) among its funders. A widely cited 2005 paper by Patzek and Cornell University professor David Pimentel concluded that ethanol takes 29% more energy to produce than it supplies—the most severe indictment of the biofuel. Michael Wang, vehicle and fuel-systems analyst at the Energy Dept.'s Argonne National Laboratory, says among several flaws in the study is the use of old data and the overestimation of corn farm energy use by 34%. Pimentel defends the study. In a recent update, he and Patzek hiked the estimate of ethanol's energy deficit to 43%.

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..NOTE: Pimentel and Patzek's 'studies' have been roundly debunked and they have been exposed as frauds by legitimate researchers (Bruce Dale, Michigan State University, Michael Wang, Argonne National Laboratory - U.S. Dept of Energy, to name a couple) but they created a lot of confusion which still exists in the minds of those lacking the time of inclination to look into this fairly technical issue. Rational people know that Ethanol has a positive energy balance (i.e. positive net energy gain) but the disinformation continues.

Big Oil vs Ethanol - Consumer Federation of America

http://www.consumerfed.org/elements/www.consumerfed.org/file/Ethanol.pdf


The oil industry threats to offset increases in ethanol production with cutbacks in
refinery expansion plans and policies to restrict ethanol distribution are serious and
demonstrate their unchallenged market power and their ability to limit competition which
could help consumers obtain lower prices for gasoline and diesel fuel. Refining and
wholesale markets have become so highly concentrated as a result of the merger wave of the
past decade that the companies do not behave in a competitive fashion.6 Eighty percent of
refining markets and 90 percent of wholesale markets in America are concentrated, according
to the Guidelines used by the Department of Justice (DOJ) and the Federal Trade Commission
(FTC).7 Big Oil has the market power to impede the growth of ethanol or to make the
consumer pay the price in the Washington D.C. and on Main Street.

THE REFINERY BOTTLENECK

The problem that regulators and policy analysts have been exploring in the refining
sector for over half a decade has finally broken into the popular press. The problem in the
refining sector was succinctly summarized in the New York Times

Refineries are a choke point in the nation’s supply of fuel. Because they have
not invested enough in refineries to increase gasoline supplies, oil companies
have been unable to meet the country’s growing demand in recent years. That
has forced them to rely on imports, which are more expensive than fuel refined
domestically…

Until the mid-1990s, the United States had significant spare refining capacity.
But because of consolidation in the industry, the number of refineries decline
while unprofitable operations were shut. As demand, grew however, and
capacity remained flat, the picture changed. In recent years, refineries in the
United States have been running at or close to full capacity.

Domestic refineries can now process about 17.5 million barrels of crude oil
each day, much of it imported. But with consumption no close to about 21
million barrels a day, more imports of refined products are also needed.

~~
~~

The Department of Energy also noted that price setting was taking place in the tight
U.S. market. Things have gotten so bad in the U.S. gasoline market that even the Energy
Information Administration, in one of its weekly reports recognized that the tight U.S.
gasoline market may be “pulling up” the price of crude. “In other words, if U.S. gasoline
markets are tight, they may ‘pull up’ crude oil prices to a degree, given that tight downstream
capacity makes each gallon of product produced that much more valuable, increasing the
value of the crude used to produce the refined product.”15
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Big Oil Wages War on Ethanol - Wired magazine

In case you think big oil is no more or less evil than any other industry, consider this: though its profits for the last three years have been the highest in human history, it currently collects $3.5 billion in taxpayer subsidies for mixing small amounts of ethanol with gas (E10). Those subsidies will double in three years. And yet the industry is doing everything it can–covert and overt–to kill off ethanol. "Business Week’s" David Kiley explores how it is funding academic studies that bash ethanol for driving up the price of corn and other foods. Failing that, oil companies refuse to support E85 gas pumps at stations. Oddly, automakers are usually the handmaidens for Big Oil’s wishes. Yet the Big Three have pledged that one-half of all vehicle sales should be flex-fuel by 2012. "Big Oil is at the top of the list for blocking ethanol acceptance by consumers and the marketplace," according to Loren Beard, senior manager for energy planning at Chrysler.
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http://www.wired.com/autopia/2007/09/big-oil-wages-w/

The price of oil and farm commodities like corn, wheat, hogs etc has more to do with what the speculators are betting on than anything else.



http://brownfieldagnews.com/2013/04/01/ethanol-gaining-profitability/

Ethanol gaining profitability
April 1, 2013 By Bob Meyer Leave a Comment

Last week’s stocks and planting intentions reports from USDA pushed corn prices down on the Chicago Board of Trade and that could be a real shot-in-the-arm for ethanol. Bloomberg reports the cheaper corn widened the price gap between ethanol and gasoline to 72.69 cents per gallon in New York on Monday morning.

The price for May-delivered denatured alcohol dropped 6.4 cents to $2.369 on the Chicago Board of Trade. The April contract which expires Wednesday fell 4 cents to $2.411 a gallon.

The increased profitability of ethanol should prompt companies to restart at least some of the more-than-20 ethanol plants that have been idled around the country. On March 22nd, Valero announced they were going to restart their Linden, Indiana plant.