A battle that has been fought for more than 90 years has erupted again in the US, with the American Petroleum Institute (API) accused of seeking to kill off the re-emerging ethanol industry.
The API recently rolled out an aggressive new campaign called “Fuel for Thought”, calling on lawmakers to set limits on the amount of ethanol and other renewable fuels that can be blended with gasoline.
The campaign makes sweeping claims that ethanol, or at least too much of it, is bad for the economy, bad for the environment and even bad for cars. These claims are already causing controversy and are staunchly denied by leaders in the ethanol industry who say that the API is simply trying to kill off the competition so they can retain their long held monopoly on transportation fuel.
The battle between the two fuels dates back to the prohibition era when gasoline took over from ethanol as the main fuel used to run cars. The first car Henry Ford ever built was designed to run on pure ethanol and in 1906, when the liquor tax was repealed, Ford declared that ethanol was the fuel of the future.
But his idea was effectively killed off by 1920 when Standard Oil founder John D Rockefeller got the temperance movement to ban the manufacture of alcohol for any purpose. So the ethanol fuel industry died in its infancy only to come back to life again in 2005 when the Renewable Fuel Standard (RFS) Programme was established.
The RFS programme mandates that every gallon of gasoline must be blended with a certain percentage of renewable fuels. It was signed into law by President George W Bush, who cited national security concerns and the need to reduce our dependence on foreign oil as his main motivation. Creating more American jobs was also advanced as a reason to nurture the ethanol industry, which last year supported 383,000 direct and indirect jobs.
As a result of the mandates established under the RFS, almost 95% of gasoline sold at pumps today contains 10% ethanol (E10) and in June of last year, the Environmental Protection Agency (EPA) authorised the sale of E15, a blend that contains 15% ethanol.
Until recently most of the ethanol that is on the market has been produced from food crops, usually corn. This “first generation” fuel has drawn a lot of opposition, however, because of its environmental impact and because of the argument that using crops for fuel drives up food prices.
So the industry has been working hard to develop second and third generation fuels such as cellulosic ethanol made from biomass, which is a much cleaner and more sustainable form of the fuel than its corn-based counterpart.
Three major corporations, Poet-DSM Advanced Biofuels, Dupont Industrial BioSciences and Abengoa Bioenergy have broken ground on new plants that will produce millions of gallons of cellulosic ethanol in the next few years. These industry leaders credit the RSF mandates with making this technological leap possible.
“There would be no market for cellulosic ethanol or other advanced biofuels without those mandates,” says Jan Koninckx, Global Business Director for DuPont. “Of course the API want the mandates repealed because they know that as the production capacity for clean fuels increases, their monopoly is under threat”.
Indeed it does not seem coincidental that the API is stepping up their anti-ethanol campaign now just as the food versus fuel argument is losing its legs and just as a much cleaner and more sustainable form of the fuel is on the cusp of commercialization. It’s also interesting to note that neither of these facts gets a mention in the API’s “fuel for thought” campaign. Instead, the campaign focuses on the same tired arguments about food prices, pollution and new misleading claims about engine damage.
One of the first “fuel for thought” ads features a car mechanic, who claims that in addition to causing pollution and driving up food prices, ethanol is simply bad for cars. He warns motorists that even the American Automobile Association (AAA) says “too much ethanol could cause engine damage that’s not covered under warranty.” The ad ends with the mechanic saying more ethanol is good news for him as he slides under a car engine allegedly damaged by too much renewable fuel.
This is a highly misleading claim, however, not least because the ad was not even endorsed by AAA. Michael Green, a national spokesperson for the organisation told me that AAA did not authorise API to use their brand and that AAA supports the development and use of ethanol and alternative fuels.