Archives

Driving my Yukon on E85 for 15,000 miles would use about 120 fewer gallons of gasoline than the Prius. (http://www.detnews.com/apps/pbcs.dll/article?AID=/20060915/OPINION01/609150313/1148/AUTO01)

Brian Akr - General Motors - Sept. 15, 2006

http://www.cleanmpg.com/photos/data/501/GM_E85_Logo.jpg
GMC Yukon FFV lowers our dependance on foreign oil.

Mike Hudson's column dismissing ethanol was a sadly cynical take on an alternative fuel that Americans can use today to begin reducing our dependence on oil ("Automakers are wasting time by pumping up E85," Aug. 16).

He acknowledges that E85 ethanol blend is a cleaner-burning, renewable resource that uses established technology to lower our nation's dependence on oil. Then he rushes to judgment with a short-term view of its challenges, specifically that it can be more expensive and it is harder to find. Actually, he says "you can't buy it anywhere."

Note to Hudson: I fill up my 2007 GMC Yukon at an E85 pump a half-mile from my home in Ann Arbor. The mileage I get is a bit lower than with pure gasoline, the performance a bit higher.

In fact, driving my Yukon on E85 for 15,000 miles would use about 120 fewer gallons of gasoline than if I drove a compact gasoline-electric hybrid like the Prius that same distance.

At GM, we take a longer view of E85. As the price of gasoline has risen and more E85-capable vehicles have been produced (GM alone has more than 2 million flex-fuel vehicles on the road), market forces are quickly leading to more ethanol production plants, greater distribution and more interest among consumers and governments. As the supply of ethanol increases, its price should come down, making it more competitive with pure gasoline.

We're unaware of any automaker that has claimed E85 is the perfect and sole solution to our oil-dependence challenge. But it's one solution that is available today and is creating jobs for Americans.

E85 is just a marketing hype to distract consumers from the rather obvious fact that GM hasn't innovated in 30 years and has nearly completely missed out on the real near-term/mid-term future of automotive technology: petrol/electric hybrids.

Saying that a Yukon gets better mileage than a Prius is a bit misleading as well. E85 is only 15% gasoline, so of course a vehicle using E85 is going to use less gasoline than someone using E10.

All E85 really accomplishes is to give GM a break on CAFE fuel economy standards and keep making non-selling guzzlers. The customers are not fooled -- if GM's looming bankruptcy is any guide.

But the real danger for E85 is that if it becomes mainstream, crop-based groceries will become exceedingly expensive. How does $25 for a box of cereal sound? Or $8 for a corn muffin? Or $30 for a loaf of bread? And you can FORGET about corn on the cobb in summer. Oh, and meat/poultry will become more expensive too, since livestock consumes huge amounts of corn.

Thanks, GM! You can put 50,000 workers on unemployment AND make my groceries expensive at the same time! Yippee! Why not just build a new hummer that burns $100 bills for fuel!

Hi Ashen Grey:

___The item of note is the guy was right if he did in fact drive 15,000 miles on E85 vs. a Prius II running straight gasoline but I doubt he did. GMC Yukon 2WD – E85 are EPA rated at 12/16 city/highway vs. 16/21 city/highway on gasoline. You are talking about a huge $ outlay given E85 was at some period more expensive then gasoline.

___As far as the bulk wholesale market is concerned today; a gallon of Ethanol is costing $1.86 vs. Gasoline (RFG) at $1.63. Thank goodness for the $0.50 tax break but once the supply/demand issues surrounding Ethanol work themselves out, this should turn around as Ethanol cost s ~ $1.60/gallon to make from Corn. The process still leaves a saleable portion for animal feed and this is icing on the cake. Owning an Ethanol plant looks to be a rather profitable venture into the near future using corn let alone Sugar Cane with prices down in the $0.60/gallon range and or a future cellulosic process at $2.50 - $3.00 per with today’s all-in costs.

___I spoke with a Farmer friend of mine yesterday and he told me that in IL., the corn silo’s have been drawn down but during the harvest, they are overwhelmed and ground storage is used for 20 + % of the crop brought in. This is corn left on the ground hoping it can be sold before it rots over the next year. We will be working into this buffer for fuel but it will not get to the point of $8.00 for a box of cereal or maybe $20.00 a gallon for Ethanol as I would start growing corn on my own property if a bushel of corn gets to $30 per myself vs. a touch over $2.40 today. I think there is another equation in all of this that the corn grown for Ethanol does not come form Sweet corn but Field corn which is used in a far different manner. I should have asked … I looked at the far out months and years and it appears that the traders are expecting corn to be in the $2.90 range next year and then in the $3.10 range out into 09. Ethanol has something to do with this of course but food or fuel? This is going to sound harsh but unprocessed corn used to be a huge export crop to feed the world. Would it not be better to use it at home and processed to a finished good at a much higher price and profit margin which also reduces out own outlay for crude? Our balance of trade is so far upside down because we sell raw material for pennies and the finished goods come roaring back for $’s let alone the actual $’s disappearing for crude itself.

___The world is a funny place as these markets sort themselves out. Even if we used all the corn produced in the US for Ethanol production, we will never be able to supply over maybe 18% of the total fuel we use on a yearly basis. This is the damper on Ethanol as a fuel from corn. The ace in the hole however is cellulosic w/ PHEV’s. We do not have enough of the raw material corn but we have a lot closer to the total amount of biodegradable plant material to jump up into the 70 + % range without PHEV’s if crude pricing gets really stupid. With gasoline costing just underneath ethanol today, I have the feeling these markets are already sorting themselves out. If you had control of the taps w/ $3.00 - $5.00 per BBl product (Raw Crude) that could be sold for $65 + ($1.60 per gallon for refined gasoline) and your major competition (Ethanol) can be sold for $1.60 per gallon, you want to just maintain that balance so as to keep those Ethanol guys on their toes. If you play games and attempt to allow your product to go to $100/BBl by pulling back on the supply with the refined stuff costing $2.50 +, at some point, the consumer gets really pissed and the Government(s) decides to throw the switch and move to Cellulosic Ethanol production with PHEV’s and take the entire crude market away from you. Sure you will be able to sell your product for plastic manufacture and such but what if a country as large as the US decides over the next 7 years we are going to full scale Cellulosic w/ PHEV’s and 6.5 of the 7 Billion barrels of crude/year we consume are no longer needed? This is what OPEC as well as our own producers face. Brazil certainly showed the world that it was possible on their very inexpensive Sugar Cane to Ethanol system. It is only a matter of time the rest of the world will do the same if the OPEC oil taps are significantly played with to maximize profits in the short term.

___I am not even bringing in Oil Shale into the discussion and I hope we do not have to use it as the GHG’s released to refine that mess are astronomical.

___I believe we are headed towards Peak Oil but we are also ramping up for other alternatives when that time actually arrives. Markets will be thrown to the wind with really crazy price swings but where there are huge profits to be made, you can darn well bet someone will fill that niche as fast as humanly possible.

___Sorry for rambling as I am just trying to figure how this is all going to play out?

___Good Luck

___Wayne

Consumer Reports (yeah, those 39mpg HCH2 rating guys) featured an excellent story on the "Ethanol Myth" and tackled many of these issues. Their conclusion was essentially the same: ethanol, like hybrid technology, is only a part of the answer and comes at the expense of other uses for food crops. At least with increased ethanol production we won't be seeing as much of a price spike this year when Big Oil brings on the 10% ethanol winter formula. Next year we won't be faced with the ethanol shortage that was brought about by it's replacement of MTBE as a fuel additive either. I'm glad we're producing more of it, but the country should be more focused on conservation and PHEV development. My grandmother was right, "waste not, want not". Maybe that should be my bumper sticker! :)