Lack of pumps limiting E85's appeal

A few years ago, Dan Meyer went shopping for a truck.

The Tuscola corn farmer wanted to buy a flexible fuel vehicle, which is capable of running on E85, a blended fuel that is 85 percent ethanol and 15 percent gasoline.

But at the time, few trucks came with that option. And there were no E85 pumps in town or even within an hour's drive from his home. So he decided against it.

"By the time I'm ready to buy my next vehicle, hopefully I can get an E85 truck and there'll be a station near me that sells E85," he said.

Good news for Meyer: Illini FS recently installed an E85 pump at its Chrisman fuel station.

It's almost a Catch-22 situation, people say. Gas station owners are hesitant to spend the money to install pumps because not many people know or ask about flexible fuel vehicles. But people won't buy flexible fuel vehicles if there are no gas stations near them that carry E85.

"My greatest concern is not on the supply side of ethanol, but the demand side. Consumers are not demanding ethanol. Unless there's a demand for flexible fuel vehicles and E85 pumps, the future of ethanol is limited," said Martha Schlicher, director of National Corn-to-Ethanol Research Center at Southern Illinois University at Edwardsville.

But media coverage and consumer interest in E85 has been building in recent months, thanks to state money, educational campaigns by groups like the Illinois Corn Growers and much lower ethanol prices compared with regular gasoline. For example, on July 20, a gallon of E85 at the Qik-n-EZ in Bloomington cost $1.85, versus $2.05 for a gallon of regular unleaded gas. In Illinois, consumers do not have to pay sales tax on E85.

Even though consumer awareness is growing, there's still a long way to go. About 400 gas stations around the country offer E85 pumps, according to the National Ethanol Vehicle Coalition. In Illinois, there are 42 stations and 16 more are planned. Most are in the Chicago region, and there are several in Bloomington and Springfield. An E85 station is planned for Mahomet and another is coming to Danville. Illini FS recently installed a pump at its Chrisman location, a credit-card only pay station.

Currently, no Champaign or Urbana stations offer the fuel.

Cost a major factor

Bernie Hammell, a retired farmer from Champaign, has been driving a flexible fuel Ford Taurus for three years now. But there's no place in town where he can fill up his tank with E85.

"The stations say it's too expensive to put it in," Hammell said.

To encourage more pumps around Illinois, the state has set aside $500,000 for gas stations that install the pumps. The state will pay up to $40,000 to a station that installs a new E85 refueling tank and pump. It will also reimburse stations up to $2,000 to convert an existing pump into an E85-capable pump.

The state hopes to have 100 stations with E85 by the end of 2006, said Hans Detweiler, deputy director of the Illinois Department of Commerce and Economic Opportunity's bureau of energy and recycling.

Without the state's financial help, Meyer Oil of Teutopolis would not have installed a new E85 pump at Meyer's Marathon Oil gas station on North Gilbert Street in Danville, said company president Randy Meyer. Danville will be Meyer's first store with E85.

"We're running this as a test to determine if it's something we will want to add to future sites," Meyer said.

The Gilbert Street station will be a brand-new site, so they won't be retrofitting any old tanks. The company has 20 other stations in the region, including one on Philo Road in Urbana. Meyer said he has applied for more grants and may install an E85 pump at the Urbana station, depending on how things go in Danville.

"I don't know to be optimistic or pessimistic. It's in such an early stage here," Meyer said.

Meyer's trucks are filled with ethanol directly at the terminals, where they're "splash blended" with gasoline. Basically, the ethanol and gasoline mix while the tanker trailer drives down the road.

Another incentive the federal government has set up to help promote ethanol demand is the Volumetric Ethanol Excise Tax Credit, which gives companies that blend ethanol with gasoline a 51-cent-per-gallon tax credit.

In spite of these incentives, it's still a struggle sometimes to convince gas stations to offer ethanol to consumers, said Monte Shaw, spokesman for the Renewable Fuels Association, which represents ethanol plants.

What's unusual about the ethanol industry is that customers of ethanol producers are also competitors, Shaw said. Ethanol plants want to see more ethanol sold at gas stations. But many gas stations are also owned by oil companies.

Flexible fuel cars

Most fuel in Illinois contains 10 percent ethanol. All cars can run on the 10 percent blend. But in order to handle the increased amount of ethanol in E85, cars have to be outfitted differently. Ethanol, after all, is an alcohol, and the car needs to be able to tolerate it.

This entails adjusting the fuel lines, tank, injectors and anything else that comes into contact with ethanol. The main difference is the fuel sensor. Ethanol has a higher oxygen content and cars need to be able to detect the higher content.

A flexible fuel vehicle will not cost thousands of dollars more. Instead, it costs the manufacturer about $100 more to make a car E85-tolerant, Detweiler estimated.

If your car is not a flexible fuel vehicle and you mistakenly fill the tank with E85, the car won't break apart on the highway. Regular vehicles are not configured to read that higher oxygen content, so the "check engine" light may come on. However, long-term use of E85 in a nonflex fuel vehicle car could cause damage to different parts of the car, according to the Illinois Corn Growers Association.

To build consumer awareness of ethanol, the Illinois Corn Growers has started targeting automobile dealerships around the state. Earlier this summer, the association invited dealers to tour the Lincolnland Agri-Energy ethanol plant in Palestine, Ill., said Roger Sy, president of the Illinois Corn Growers. They gave attendees three-ring binders with information about flexible fuel vehicles and E85, plus state and federal incentives. Ideally, Sy said, he would like to see dealers highlight flexible fuel vehicles on their lots by, for example, marking them with stickers or attaching styrofoam balls to their antennas.

Ethanol performance

If there's any doubt about how ethanol performs as a fuel, consider this.

In March, the Indy Car Series, which is responsible for the Indy 500 and other car races, announced that cars would run on a maximum blend of 10 percent ethanol and 90 percent methanol during the 2006 racing season. (Methanol has been the standard fuel for race cars for years.) But beginning in 2007, cars would run on 100 percent ethanol.

"The ethanol performance is excellent," said Ebby Bergfield, an Arcola farmer who owns Midget and Silver Crown race cars. Midget and Silver Crowns are open-wheel cars raced on dirt tracks.

Bergfield and Tuscola farmer Dan Meyer are also doing their part to promote ethanol.

The two petitioned the United States Auto Club (USAC), which manages dirt track racing for Midgets and Silver Crowns, to allow them to run their cars on 10 percent ethanol.

They got the OK, and now the cars, driven by Riverton resident Justin Allgaier, are fueled by ethanol. Because there is no local supplier, Bergfield buys ethanol by the barrel from a plant in Pekin, then blends it with methanol in his shed. He then brings it along on races.

The two also solicited sponsors from the agriculture community, such as the Illinois Corn Marketing Board, seed corn companies, grain elevators, farm analysts and more.

"We felt this would be a natural fit for ethanol. Racing has always been a leader in terms of trying out new technology," Meyer said.

Their next goal? Following Indy's lead and pushing for 100 percent ethanol.

It's safer, cleaner burning and runs cooler in the engine, Meyer said. Plus it has more BTUs than methanol, the traditional racing fuel.

"You're increasing your oxygen content. It burns less noxious fumes and gives you a higher octane level," Roger Sy added.

Although ethanol has more energy than methanol, it still has less BTUs than gasoline. That means fuel efficiency is less in a car driven on E85.

"You will lose a little in mileage overall," Sy said.

Fuel economy can drop by about 5 to 15 percent, depending on driving habits and whether it's highway or in-town driving.

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