Ethanol Blog

LINCOLN, Neb. (DTN) -- If California regulators allow E15 sales in the state consumers could save up to $2.7 billion annually, according to a new study commissioned by the Renewable Fuels Association.

Economists at the University of California, Berkeley and the U.S. Naval Academy found that California drivers could save about 20 cents per gallon if E15 was made legal. State regulators reportedly are considering ending the restriction of ethanol in gasoline to 10% or E10.

California is the only state that currently does not allow E15 sales.

The study by David Zilberman, distinguished professor in the agricultural and resources economics department at UC Berkeley and Scott Kaplan, assistant professor in the economics department at the Naval Academy, found a number of benefits from making E15 available in California.

"Consumers have the potential to gain significantly from the introduction and purchase of E15," according to the study. "In particular, our estimates suggest an approximately 20 cents per gallon discount for E15 compared with E10 after adjusting for energy content."

California regulators are considering approval of E15 after vehicle testing showed the fuel offers emissions benefits, the RFA said in a news release.

E15 is approved by the U.S. Environmental Protection Agency for use in all cars, pickups, sport-utility vehicles and vans manufactured in the past 24 years.

The researchers found that increased use of ethanol-blend biofuels lowers gasoline usage, enhances energy security and reduces greenhouse gas emissions.

"Based on this study's results, a typical California household could save $200 per year on their gas bill if state regulators would simply allow drivers to fuel up on E15," RFA President and CEO Geoff Cooper said in a news release.

Cooper said there are more than 24 million registered vehicles in California already approved to use E15.

"It's time for California to catch up to the other 49 states that already allow consumers to choose lower-cost, lower-carbon E15," he said.

"The state's failure to approve the use of E15 essentially amounts to a gas price hike at a time when hardworking Californians can least afford it."

The study also found that "low-income commuters may stand to gain the most from a transition towards E15," given their propensity to have longer commutes and less fuel-efficient vehicles.

An earlier 315-page study commissioned by the California Air Resources Board and conducted by scientists at the University of California, Riverside, found that allowing E15 sales in California could also provide environmental benefits, cutting emissions of tailpipe pollutants like particulate matter and carbon monoxide that cause air quality and human health problems.

Todd Neeley can be reached at todd.neeley@dtn.com

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