A Blueprint for Keeping Midwest Dollars in the Midwest

by Dave VanderGriend (Urban Air Initiative/ICM/Ethanol Producer Magazine) Urban Air Initiative President Dave VanderGriend says increasing the availability of ethanol blender pumps and higher blends will keep ethanol in the Midwest, pumping millions of dollars into the economy. -- ... The problem lies in the fact that Iowa consumes 1.4 billion gallons of gasoline, none of which is produced in the state and all of which is consistently 30 to 40 cents per gallon more expensive than ethanol. So while we reduced the cost of 10 percent of Iowa gasoline, the other 90 percent is imported and costs consumers millions. It doesn’t have to be this way, we have the ability to reduce that cost. It’s pretty straightforward—we make fuel in Iowa at $1.30 and export it, and we import fuel at $1.70.

While we can’t replace all our gasoline, displacing 20 percent of our gasoline from the current 10 percent rate would increase ethanol sales in Iowa by 170 million gallons. At a 40-cents-per-gallon advantage over gasoline, we would save Iowa consumers $68 million.

Millions of miles are being driven on 20, 25 and 30 percent volume blends in various test programs with no adverse effects, while reducing operating costs and improving performance.

This same example applies to Nebraska, Illinois, South Dakota and any number of Midwest states. Imagine the control over our own future we would have if we adopted a regional agreement to use higher ethanol blends.

So how do we get started? It must start from the top and our elected officials can take this initiative and lead by example. The Governors’ Biofuel Coalition is likely to get a green light from the U.S. Environmental Protection Agency to demonstrate E30 in state vehicles in the coming weeks. At the Urban Air Initiative, we have petitioned EPA asking for no limits on ethanol volumes in gasoline. READ MORE