Fuel for thought: Some consumers cry foul, as more stations switch to E10 gasoline

More and more gasoline pumps throughout the Capital Region are featuring an E10 sticker on them. E10
With downtown Albany in the background, LogiBio employees work on ethanol tankers at the Port of Albany.
With downtown Albany in the background, LogiBio employees work on ethanol tankers at the Port of Albany.

When Albany resident Ed Atkeson purchased his 2007 Honda Civic Hybrid, his goal was to save money on gasoline and help the environment. He didn’t anticipate having to fuel the vehicle with E10 gasoline.

“As far as I’m concerned, they may as well put water in the gas,” Atkeson said.

When Atkeson first purchased his car, which uses gasoline and then electric power harnessed from the car’s brake system to increase fuel mileage, he said he routinely got in excess of 50 miles per gallon. Recently he said his fuel economy has dropped to approximately 40 mpg on the highway and 35 mpg in the city.

“We took our car in for standard maintenance . . . we expected them to adjust the car because something was obviously wrong because we were getting much less mileage than the first few months that we owned the car,” he said. “They said there’s nothing wrong with the car. The explanation they gave was ‘that’s the ethanol, it ruins your gas mileage.’ ”

More and more gasoline pumps throughout the Capital Region are featuring an E10 sticker on them. E10 is a blend of 90 percent gasoline and 10 percent ethanol, an alcohol.

Corn-based ethanol has become a steadily more popular source of federally subsidized renewable energy because burning the fuel is thought to have a net zero effect on carbon dioxide emissions linked by some scientists to global warming. According to the U.S. Energy Information Administration, corn plants absorb as much CO2 as burning the fuel emits.

Stewarts Shops Corp. gasoline manager Mike Bombard said 207 of the 275 Stewart’s locations selling gasoline have converted to offering E10. Bombard said stores in the Capital Region have switched because of market conditions, concerns about carbon dioxide emissions and the local availability of ethanol.

“The vast majority of the marketplace has done this,” Bombard said.

How much energy?

Most automobiles and trucks in the United States are able to run on E10 fuel, but the fuel contains less energy than gasoline. According to the EIA, a gallon of gasoline has approximately 122,169 British thermal units of energy, compared with 83,333 Btu per gallon of ethanol.

Using EIA numbers, an approximate gallon of E10 gasoline should have about 118,285 Btu, 3.2 percent less than regular unleaded gasoline. How that affects fuel mileage in various model cars is disputed by proponents and opponents of ethanol production and consumers of the product.

According to the Renewable Fuels Association, the trade association for the U.S. ethanol industry, fuel injected cars may experience a decrease of approximately 2 percent in fuel economy using E10.

Tony Kossman, the chairman of Hudson Valley Community College’s Automotive Technical Service Department, said he drives a full-sized truck and has routinely seen his gas mileage reduced more than 2 percent since E10 came to the Capital Region.

“It reduces the fuel mileage by 10 to 20 percent. Nobody has experienced as little [as 2 percent] fuel mileage loss. The least you hear about is 10 percent and then up from there,” Kossman said. “It’s all proportional. The big cars, because they are larger and there is less energy [in E10], will use more fuel.”

Ruth Horton, a researcher at the New York State Energy Research and Development Authority, said E10 should not hurt fuel economy very much for most cars and claims of more than 10 percent loss are anecdotal and not scientific.

“There hasn’t been any kind of robust testing of that,” Horton said.

Consumer Reports Magazine has long published its “real-world fuel economy figures” in contrast to the U.S. Environmental Protection Agency fuel economy estimates used by car manufacturers. Consumer Reports’ figures have always shown significantly lower gas mileage than the EPA, in part because Consumer Reports runs vehicles through what it considers real-world conditions for city and highway driving, while the EPA has traditionally used what many consider a less realistic test.

Consumer Reports has also been testing all vehicles using E10 for the last several years because it is in Connecticut which, along with the New York City region, is within an EPA ozone nonattainment area and must sell oxygenated gasoline.

Ethanol replaced MTBE as a gasoline oxygenate in the EPA ozone nonattainment areas of New York state and Connecticut when those states banned MTBE after it was shown to pollute groundwater when spilled or leaked.

The Capital Region is not in an EPA ozone nonattainment area and oxygenated gas is not required to be sold here.

According to Consumer Reports, Atkeson’s 2007 Honda Civic Hybrid, when driven with E10, should average 47 mpg on the highway and 26 mpg in city driving, both less than 2007 EPA estimates of 51 mpg on the highway and 49 mpg in the city.

Keeler Honda Service Manager Guy Guadagnino said some Honda customers have complained to him of lower fuel mileage since using E10.

“It just doesn’t burn the same. I know Honda does not recommend burning that type of fuel in their vehicles, simply because they know it’s going to drop the gas mileage. It doesn’t combust the same,” Guadagnino said.

Atkeson said he wishes he wasn’t forced to buy E10 from most retailers.

“So far I have not seen any signs that say ‘we sell pure gasoline, no ethanol.’ That would be an incentive for me to buy at that station,” he said.

Schenectady County Department of Consumer Affairs Director Christopher Godlewski said he has documented the spread of E10 through his county.

“Most of the gasoline stations, with the exception of the Sunocos and the Mobil Marts, in our county have gone to E10. I know because I check them all,” Godlewski said. “Mobil gets their own gas from the Mobil terminal down in Albany. They’re in the petroleum business, not the ethanol business.”

Ethanol in Albany

In the Capital Region the ethanol distribution business has been booming.

“The port of Albany is one of the largest ports in the country for ethanol transportation,” Bombard said, citing that as one of the reasons Stewarts Shops converted so many of its upstate stores to E10-only.

Market conditions in the Capital Region pushed ethanol distribution up last year ahead of impending legislation mandating its use throughout the country.

In December, President Bush signed legislation mandating a sixfold increase in U.S. ethanol use to 36 billion gallons a year by 2022.

According to the Oil Information Service, the EPA, which enforces ethanol-use regulations, could as a result of the 2007 Energy Bill push ethanol consumption by forcing marketers to blend ethanol into 7.5 percent of total gasoline sold in the U.S. in 2008, up from 4 percent in 2007.

Ethanol distribution in the Capital Region spiked last summer after Houston-based ethanol trader BioUrja Trading purchased the former Cibro Petroleum Products Albany terminal for $10.125 million at a bankruptcy court auction. BioUrja Trading renamed the terminal Logibio Albany Terminal and enhanced its ethanol operation.

BioUrja Trading Vice President of Logistics Nathalie de Vos Burchart said since her company took over the terminal in July, CSX Corp. has increased ethanol transportation from the Midwest to Logibio Albany Terminal from 80-car trains to 102-car trains, for an approximate monthly average of 1,000 train cars carrying about 29 million gallons of ethanol. She said 25 percent of the terminal’s 2 million-barrel storage capacity is dedicated to ethanol.

“The terminal is just generally growing in volume and activity, particularly on the ethanol side,” de Vos Burchart said. “That’s what we’re concentrating on. That’s our background. BioUrja Trading is a large ethanol trading company. Our lead trader was the U.S. buyer of ethanol for Exxon Mobil. A little over 10 percent of the U.S. ethanol volume, pretty much, went through his hands when he was at Exxon.”

Corn-based ethanol can be brought to market only by trucks or rail cars because current pipeline technology cannot protect the fuel from being contaminated by water, according to the EIA.

Logibio Albany Terminal officials call the terminal “pace-setting in the ethanol industry” because the Port of Albany has no dock congestion and it only takes about a week for ethanol-transporting cars to unload in Albany and return to production plants.

“We barge ethanol out to New York harbor, to Boston, to Philadelphia, to pretty much the end-user terminals. We also truck it out to the local Albany market,” she said. “There’s several stations converting [to E10 ethanol] as we speak.”

E10 pumps have spread as far from Albany as Fulton County.

“The E10 has only popped up here [starting] late last year,” Fulton County Department of Weights and Measures Director Neil Daley said. “They are popping up left and right with 10 percent ethanol.”

Cost to consumers

Stewart’s Shops President Gary Dake told The Daily Gazette in December that it was costly for his company to convert many of its pumps to be compatible with E10. He said he hopes that ethanol will ultimately have a positive impact on the region.

“It should ultimately have a depressing effect on the price of the gasoline,” he said. “But that’s going to depend on the price of ethanol, which has been going up.”

Rick Kment, the ethanol industry analyst for Omaha, Neb.-based DTN, wrote in his daily ethanol blog Thursday that the national average price for ethanol fell 1.8 cents per gallon Thursday to about $2.30, still lower than the national average price for gasoline at $2.97.

The price of ethanol has risen steadily since its November bulk trading price of $1.79 per gallon due to the “quiet infiltration of E10 blends into conventional markets” according to the Oil Price Information Service.

The average price of gasoline in the Capital Region on Thursday was $3.26.

Bombard said fuel blenders receive a federal tax credit of 51 cents per gallon of ethanol they blend into gasoline. He said the credit has helped make ethanol more affordable for retailers, but not by much.

“[The tax break] can at times lower the price, but other times what will happen is the cost of the ethanol component is higher even after you get that 51 cents, putting it closer to the gasoline price,” he said. “There have been periods over the last several weeks where gasoline containing 10 percent ethanol actually costs more to purchase, for us, than regular straight gasoline.”

Some gasoline retailers may use a gasoline particulate filter that only removes dust and dirt, which enables them to switch from E10 to pure gasoline without reconfiguring pumps, said Bombard. Stewarts Shops, though, have a special moisture filter designed for ethanol, he said.

“There are players that are going into ethanol and doing it in a method that I don’t consider safe for the public. We went through and made sure all of our tanks were cleaned and prepped properly to begin selling ethanol,” Bombard said. “Ethanol is actually a cleansing agent that can take off some of the buildup that’s gotten onto the sides of gas tanks over the years and if [retailers] aren’t running the proper filters, that can be passed on to customers.”

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