Ethanol fuel in the United States

. Miami, Florida. In 1826 Samuel Morey experimented with an internal combustion chemical mixture that used ethanol (combined with turpentine and ambient air then vaporized) as fuel. At the time, his discovery was overlooked, mostly due to the success of steam power. Ethanol fuel received little attention until 1860 when Nicholas Otto began experimenting with internal combustion engines. In 1859, oil was found in Pennsylvania, which decades later provided a new kind of fuel. Popular fuels in the U.S. before petroleum were a purified form of spirits of turpentine called camphene, and a blend of turpentine and alcohol known as burning fluid. The discovery of a ready supply of oil and Civil War taxation on burning fluid made kerosene a more popular fuel. In 1896, Henry Ford designed his first car, the "Quadricycle" to run on pure ethanol. Ford continued to advocate for ethanol fuel even during the prohibition, but lower prices caused gasoline to prevail. MTBE's use as an oxygenate additive was widespread due to mandates in the Clean Air Act amendments of 1992 to reduce carbon monoxide emissions. MTBE in gasoline had been banned in almost 20 states by 2006. Suppliers were concerned about potential litigation and a 2005 court decision denying legal protection for MTBE. MTBE's fall from grace opened a new market for ethanol, its primary substitute. ==Recent trends==

The world's top ethanol fuel producer in 2010 was the United States with 13.2 billion U.S. gallons (49.95 billion liters) representing 57.5% of global production, followed by Brazil with 6.92 billion U.S. gallons (26.19 billion liters), and together both countries accounted for 88% of the world production of 22.95 billion U.S. gallons (86.85 billion liters). By December 2010 the U.S. ethanol production industry consisted of 204 plants operating in 29 states, As a result, some plants operated below capacity, several firms closed plants, others laid off staff, some firms went bankrupt, plant projects were suspended and market prices declined. As of 2011, most of the U.S. car fleet was able to run on blends of up to 10% ethanol, and motor vehicle manufacturers produced vehicles designed to run on more concentrated blends. As of 2015, seven states – Missouri, Minnesota, Louisiana, Montana, Oregon, Pennsylvania, and Washington – required ethanol to be blended with gasoline in motor fuels. These states, particularly Minnesota, had more ethanol usage, and according to a source at Washington University, these states accumulated substantial environmental and economic benefits as a result. Florida required ethanol blends as of the end of 2010, but has since repealed it. Many cities had separate ethanol requirements due to non-attainment of federal air quality standards. In 2007, Portland, Oregon, became the first U.S. city to require all gasoline sold within city limits to contain at least 10% ethanol. Chicago has proposed the idea of mandating E15 in the city limits, while some area gas stations have already begun offering it. Expanding ethanol (and biodiesel) industries provided jobs in plant construction, operations, and maintenance, mostly in rural communities. According to RFA the ethanol industry created almost 154,000 U.S. jobs in 2005, boosting household income by $5.7 billion. It also contributed about $3.5 billion in federal, state and local tax revenues. E85 vehicles (top right), Ford (middle right) and GM (bottom right). Ford, Chrysler, and GM are among many automobile companies that sell flexible-fuel vehicles that can run blends ranging from pure gasoline to 85% ethanol (E85), and beginning in 2008 almost any type of automobile and light duty vehicle was available with the flex-fuel option, including sedans, vans, SUVs and pickup trucks. By early 2013, about 11 million E85 flex-fuel cars and light trucks were in operation, As of 2005, 68% of American flex-fuel car owners were not aware they owned an E85 flex. Flex and non-flex vehicles looked the same. There was no price difference. American automakers did not label these vehicles. In contrast, all Brazilian automakers clearly labeled FFVs with text that was some variant of the word Flex. Beginning in 2007 many new FFV models in the U.S. featured a yellow gas cap to remind drivers of the E85 capabilities. As of 2008, GM badged its vehicles with the text "Flexfuel/E85 Ethanol". Nevertheless, the U.S. Department of Energy (DOE) estimated that in 2009 only 504,297 flex-fuel vehicles were regularly fueled with E85, and these were primarily fleet-operated vehicles. As a result, only 712 million gallons were used for E85, representing just 1% of that year's ethanol consumption. During the decade following 2000, E85 vehicles became increasingly common in the Midwest, where corn was a major crop. Fueling infrastructure has been a major restriction hampering E85 sales. Most stations were in the Corn Belt states. As of 2008 the leading state was Minnesota with 353 stations, followed by Illinois with 181, and Wisconsin with 114. About another 200 stations that dispensed ethanol were restricted to city, state and federal government vehicles. In October 2010, the EPA granted a waiver to allow up to 15% blends to be sold for cars and trucks with a model year of 2007 or later, representing about 15% of vehicles on the roads. Despite this initial caution and in response to EPA regulations, several automakers began certifying newer models for E15 use. General Motors approved its 2012 and 2013 model year vehicles for E15, advising owners of pre-2011 models to adhere to fuel specifications in their manuals. Ford Motor Company made its full 2013 lineup, including hybrid electric and Ecoboost vehicles, E15 compatible. Porsche, according to the late 2012 AAA report, had approved E15 for its models built since 2001. and Fiat Chrysler Automobiles announced in August 2015 that all its 2016 model year Chrysler/Fiat, Jeep, Dodge, and Ram vehicles would be compatible. Despite EPA's waiver, there is a practical barrier to the commercialization of the higher blend due to the lack of infrastructure, similar to the limitations suffered by sales of E85, as most fuel stations do not have enough pumps to offer the new blend, few existing pumps are certified to dispense E15, and there are no dedicated tanks readily available to store E15. This station was followed by a Marathon fueling station in East Lansing, Michigan. , there are about 24 fueling stations selling E15 out of 180,000 stations operating across the U.S. Legislation and regulations signs a 2019 executive order permitting the sale of 15% ethanol fuel year-round The Energy Independence and Security Act of 2007, directed DOE to assess the feasibility of using intermediate ethanol blends in the existing vehicle fleet. This preliminary report found that none of the vehicles displayed a malfunction indicator light; no fuel filter plugging symptoms were observed; no cold start problems were observed at and under laboratory conditions; and all test vehicles exhibited a loss in fuel economy proportional to ethanol's lower energy density. For example, E20 reduced average fuel economy by 7.7% when compared to gas-only (E0) test vehicles. The Obama Administration set the goal of installing 10,000 blender pumps nationwide by 2015. These pumps can dispense multiple blends including E85, E50, E30 and E20 that can be used by E85 vehicles. The US Department of Agriculture (USDA) issued a rule in May 2011 to include flexible fuel pumps in the Rural Energy for America Program (REAP). This ruling provided financial assistance, via grants and loan guarantees, to fuel station owners to install E85 and blender pumps. In May 2011 the Open Fuel Standard Act (OFS) was introduced to Congress with bipartisan support. The bill required that 50 percent of automobiles made in 2014, 80 percent in 2016, and 95 percent in 2017, be manufactured and warrantied to operate on non-petroleum-based fuels, which included existing technologies such as flex-fuel, natural gas, hydrogen, biodiesel, plug-in electric and fuel cell. Considering the rapid adoption of flexible-fuel vehicles in Brazil and the fact that the cost of making flex-fuel vehicles was approximately $100 per car, the bill's primary objective was to promote a massive adoption of flex-fuel vehicles capable of running on ethanol or methanol fuel. In November 2013, the Environmental Protection Agency opened for public comment its proposal to reduce the amount of ethanol required in the U.S. gasoline supply as mandated by the Energy Independence and Security Act of 2007. The agency cited problems with increasing the blend of ethanol above 10%. This limit, known as the "blend wall", refers to the practical difficulty in incorporating increasing amounts of ethanol into the transportation fuel supply at volumes exceeding those achieved by the sale of nearly all gasoline as E10. Contractual restrictions Gasoline distribution contracts in the United States generally have provisions that make offering E15 and E85 difficult, expensive, or even impossible. Such provisions include requirements that no E85 be sold under the gas station canopy, labeling requirements, minimum sales volumes, and exclusivity provisions. Penalties for breach are severe and often allow immediate termination of the agreement, cutting off supplies to retailers. Repayment of franchise royalties and other incentives is often required. ==Energy security==

. One rationale for ethanol production in the U.S. is increased energy security, from shifting supply from oil imports to domestic sources. Ethanol production requires significant energy, and current U.S. production derives most of that energy from domestic coal, natural gas and other non-oil sources. Because in 2006, 66% of U.S. oil consumption was imported, compared to a net surplus of coal and just 16% of natural gas (2006 figures), the displacement of oil-based fuels to ethanol produced a net shift from foreign to domestic U.S. energy sources. ==Effect on gasoline prices==

The effect of ethanol use on gasoline prices is the source of conflicting opinion from economic studies, further complicated by the non-market forces of tax credits, met and unmet government quotas, and the dramatic recent increase in domestic oil production. According to a 2012 Massachusetts Institute of Technology analysis, ethanol, and biofuel in general, does not materially influence the price of gasoline, while a runup in the price of government mandated Renewable Identification Number credits has driven up the price of gasoline. ==Tariffs and tax credits==

Since the 1980s until 2011, domestic ethanol producers were protected by a 54-cent per gallon import tariff, mainly intended to curb Brazilian sugarcane ethanol imports. Beginning in 2004 blenders of transportation fuel received a tax credit for each gallon of ethanol they mix with gasoline. Several countries in the Caribbean Basin imported and reprocessed Brazilian ethanol, usually converting hydrated ethanol into anhydrous ethanol, for re-export to the United States. They avoided the 2.5% duty and the tariff, thanks to the Caribbean Basin Initiative (CBI) and free trade agreements. This process was limited to 7% of U.S. ethanol consumption. As of 2011, blenders received a per gallon tax credit, regardless of feedstock; small producers received an additional on the first 15 million US gallons; and producers of cellulosic ethanol received credits up to . Tax credits to promote the production and consumption of biofuels date to the 1970s. For 2011, credits were based on the Energy Policy Act of 2005, the Food, Conservation, and Energy Act of 2008, and the Energy Improvement and Extension Act of 2008. On June 16, 2011, the U.S. Congress approved an amendment to an economic development bill to repeal both the tax credit and the tariff, but this bill did not move forward. Nevertheless, the U.S. Congress did not extend the tariff and the tax credit, allowing both to end on December 31, 2011. Since 1980 the ethanol industry was awarded an estimated billion in subsidies. ==Feedstocks==

Corn Corn is the main feedstock used for producing ethanol fuel in the United States. As of 2008 researchers were attempting to breed new varieties adapted to U.S. soil and weather conditions, as well as to take advantage of cellulosic ethanol technologies to also convert sugarcane bagasse. U.S. sugarcane production occurs in Florida, Louisiana, Hawaii, and Texas. The first three plants to produce sugarcane-based ethanol went online in Louisiana in mid-2009. Sugar mills in Lacassine, St. James and Bunkie were converted to sugarcane ethanol production using Colombian technology to enable profitable ethanol production. These three plants planned to produce of ethanol per year within five years. By 2009 two other sugarcane ethanol production projects were being developed in Kauai, Hawaii and Imperial Valley, California. The Hawaiian plant was projected to have a capacity of between a year and to supply local markets only, as shipping costs made competing in the continental US impractical. This plant went online in 2010. The California plant was expected to produce a year in 2011. during Bush's visit to Brazil, March 2007. In March 2007, "ethanol diplomacy" was the focus of President George W. Bush's Latin American tour, in which he and Brazil's president, Luiz Inácio Lula da Silva, promoted the production and use of sugarcane ethanol throughout the Caribbean Basin. The two countries agreed to share technology and set international biofuel standards. Brazilian sugarcane technology transfer was intended to permit various Central American, such as Honduras, El Salvador, Nicaragua, Costa Rica and Panama, several Caribbean countries, and various Andean Countries tariff-free trade with the U.S., thanks to existing trade agreements. The expectation was that such countries would export to the United States in the short-term using Brazilian technology. In 2007, combined exports from Jamaica, El Salvador, Trinidad and Tobago and Costa Rica to the U.S. reached a total of of sugarcane ethanol, representing 54.1% of imports. Brazil began exporting ethanol to the U.S. in 2004 and exported representing 44.3% of U.S. ethanol imports in 2007. The remaining imports that year came from Canada and China. Other feedstocks Cheese whey, barley, potato waste, beverage waste, and brewery and beer waste have been used as feedstocks for ethanol fuel, but at a far smaller scale than corn and sugarcane ethanol, as plants using these feedstocks have the capacity to produce only per year. ==Comparison with Brazilian ethanol==

Sugarcane ethanol has an energy balance seven times greater than corn ethanol. As of 2007, Brazilian distiller production costs were 22 cents per liter, compared with 30 cents per liter for corn-based ethanol.{{cite news == Environmental and social impact ==

Environmental effects Energy balance and carbon intensity Until 2008, several full life cycle ("Well to Wheels") studies had found that corn ethanol reduces greenhouse gas emissions as compared to gasoline. In 2007 a team led by Farrel from the University of California, Berkeley evaluated six previous studies and concluded corn ethanol reduces greenhouse gas emissions by only 13 percent. Both figures were estimated by Wang from Argonne National Laboratory, based on a comprehensive review of 22 studies conducted between 1979 and 2005, and simulations with Argonne's GREET model. All of these studies included direct land use changes. However, further research examining the actual effects of the Renewable Fuel Standard from 2008 to 2016 has concluded that corn ethanol produces more carbon emissions per unit of energy – likely more than 24% more – than gasoline, when factoring in fertilizer use and land use change. The reduction estimates on carbon intensity for a given biofuel depend on the assumptions regarding several variables, including crop productivity, agricultural practices, and distillery power source and energy efficiency. None of these earlier studies considered the effects of indirect land-use changes, and though their impact was recognized, its estimation was considered too complex and more difficult to model than direct land use changes. Effects of land use change Two 2008 studies, both published in the same issue of Scienceexpress, questioned the previous assessments. A team led by Searchinger from Princeton University concluded that once direct and indirect effect of land use changes (ILUC) are considered, both corn and cellulosic ethanol increased carbon emissions as compared to gasoline by 93 and 50 percent respectively. Low-carbon fuel standards On April 23, 2009, the California Air Resources Board approved specific rules and carbon intensity reference values for the California Low-Carbon Fuel Standard (LCFS) that was to go into effect on January 1, 2011. The consultation process produced controversy regarding the inclusion and modeling of indirect land use change effects. After the CARB's ruling, among other criticisms, representatives of the ethanol industry complained that the standard overstated the negative environmental effects of corn ethanol, and also criticized the inclusion of indirect effects of land-use changes as an unfair penalty to home-made corn ethanol because deforestation in the developing world had been tied to U.S. ethanol production. The emissions standard for 2011 for LCFS meant that Midwest corn ethanol would not meet the California standard unless current carbon intensity is reduced. A similar controversy arose after the U.S. Environmental Protection Agency (EPA) published on May 5, 2009, its notice of proposed rulemaking for the new Renewable Fuel Standard (RFS). EPA's proposal included the carbon footprint from indirect land-use changes. On the same day, President Barack Obama signed a Presidential Directive with the aim to advance biofuel research and commercialization. The Directive asked a new Biofuels Interagency Working Group comprising the Department of Agriculture, EPA, and DOE, In December 2009 two lobbying groups, the Renewable Fuels Association (RFA) and Growth Energy, filed a lawsuit challenging LCFS's constitutionality. The two organizations argued that LCFS violates both the Supremacy Clause and the Commerce Clause of the US Constitution, and "jeopardizes the nationwide market for ethanol." In a press release the associations announced that "If the United States is going to have a low carbon fuel standard, it must be based on sound science and it must be consistent with the U.S. Constitution". On February 3, 2010, EPA finalized the Renewable Fuel Standard Program (RFS2) for 2010 and beyond. EPA incorporated direct emissions and significant indirect emissions such as emissions from land use changes along with comments and data from new studies. Given average production conditions it expected for 2022, EPA estimated that corn ethanol would reduce GHGs an average of 21% compared to the 2005 gasoline baseline. A 95% confidence interval spans a 7-32% range reflecting uncertainty in the land use change assumptions. In 2010 RFA argued that more efficient water technologies and pre-treated water could reduce consumption. It further claimed that non-conventional oil "sources, such as tar sands and oil shale, require far more water than conventional petroleum extraction and refining." Social implications Effect on food prices Some environmentalists, such as George Monbiot, expressed fears that the marketplace would convert crops to fuel for the rich, while the poor starved and biofuels caused environmental problems. The food vs fuel debate grew in 2008 as a result of the international community's concerns regarding the steep increase in food prices. In April 2008, Jean Ziegler, back then United Nations Special Rapporteur on the Right to Food, repeated his claim that biofuels were a "crime against humanity", found that from June 2002 to June 2008 "biofuels and the related consequences of low grain stocks, large land use shifts, speculative activity and export bans" accounted for 70–75% of total price rises. The study found that higher oil prices and a weak dollar explain 25–30% of total price rise. The study said that "large increases in biofuels production in the United States and Europe are the main reason behind the steep rise in global food prices." The report argued that increased production of biofuels in these developed regions was supported by subsidies and tariffs, and claimed that without such policies, food price increases worldwide would have been smaller. It also concluded that Brazil's sugarcane ethanol had not raised sugar prices significantly, and recommended that both the U.S. and E.U. remove tariffs, including on many African countries. A 2010 World Bank study concluded that its previous study may have overestimated the impact, as "the effect of biofuels on food prices has not been as large as originally thought, but that the use of commodities by financial investors (the so-called 'financialization of commodities') may have been partly responsible for the 2007/08 spike." A July 2008 OECD economic assessment agreed about the negative effects of subsidies and trade restrictions, but found that the impact of biofuels on food prices was much smaller. The OECD study found that existing biofuel support policies would reduce greenhouse gas emissions by no more than 0.8 percent by 2015. It called for more open markets in biofuels and feedstocks to improve efficiency and lower costs. The OECD study concluded that "current biofuel support measures alone are estimated to increase average wheat prices by about 5 percent, maize by around 7 percent and vegetable oil by about 19 percent over the next 10 years." During the 2008 financial crisis corn prices, fell 50% from their July 2008 high by October 2008, in tandem with other commodities, including oil, while corn ethanol production continued unabated. "Analysts, including some in the ethanol sector, say ethanol demand adds about 75 cents to $1.00 per bushel to the price of corn, as a rule of thumb. Other analysts say it adds around 20 percent, or just under 80 cents per bushel at current prices. Those estimates hint that $4 per bushel corn might be priced at only $3 without demand for ethanol fuel." Reviewing eight years of actual implementation of the Renewable Fuel Standard, researchers from the University of Wisconsin found the standard increased corn prices by 30% and prices of other crops by 20%. ==See also==