NYS ASSOCATIONS COMMENT ON E85 INITIATIVES

             The Association and its members wish to confirm their support of the use of alternative fuels.  E85, a mixture of 85% ethanol and 15% gasoline is one such fuel designed to help the environment, while reducing our nation’s dependence on foreign oil.  Our members have indicated a willingness to sell E85, dependent on one concern being answered.  Our dealers fear that selling the fuel will not be economically viable.  Many dealers will be placed in a position of upgrading, replacing, or adding pumps and tanks designed to handle the additional degradation problems inherent with a high ethanol fuel. According to the National Ethanol Vehicle Coalition (NEVC), which is the major promoter of E85, many of the car models produced in the last decade are compatible both with gas and with E85.  It would appear there is a large target base for the product.  E85 is available at roughly the same retail price as 87 octane unleaded gas, and provides approximately 5% more horse power, as its octane rating is about 105.  All of this sounds.

The problem is that the vehicles get 10-15% lower mileage with E85 than with 87 octane gasoline.  This means the price of E85 must be 30-50 cents less than the price of gasoline in order for the product to remain marketable.  It does appear that the statement by the NEVC, that the price of E85 is roughly similar to 87 octane gasoline is somewhat outdated.  An internet post board by the American Lung Association (htt;://www.cleanairchoice.org/outdoor/PriceForum.asp) indicates prices for E85 varying from 60 cents below to 15 cents above 87 octane.  Much of the variation in price seems to be state by state and would appear to depend on whether the state offers retailers incentives on fuel sales or tank and pump installations/upgrades.

According to Ralph Bombardiere, executive director of the New York State Association of Service Stations, “The Association cautiously expresses support for initiatives to expand the use of E85 in New York State, should these initiatives be coupled with incentives to dealers, to ensure that E85 will be an economically viable product.”