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Landon Hall

Is your car a flex-fuel vehicle? Use this tool to find out

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You’ve seen the badges on the rear ends of cars, trucks and SUVs, likely while you’re stuck in traffic. They say “FlexFuel” or, more descriptively, “FlexFuel … E85 Ethanol.” Almost 20 million vehicles in the United States come off the assembly line as flex-fuel, meaning they can run perfectly well on any mixture of gasoline and ethanol, up to E85 (which is actually 51 percent to 83 percent ethanol, the rest gasoline).

But not all of them have that shiny badge declaring them flex-fuel vehicles (FFVs). Sometimes a yellow gas cap is the dead giveaway, but those caps only started appearing on model-year 2008 vehicles (2006 for General Motors). Buried deep inside the owner’s manual, too, is a notice about which fuels are approved to run in your vehicle.

Now, there’s an easy tool that will tell you whether you’re one of those lucky 20 million whose vehicle can take E85. Fuel Freedom Foundation has just unveiled the Check Your Car tool. You can enter in your vehicle’s make, model, year and engine size, and it’ll tell you whether you’re driving an FFV.

This tool is long overdue, because ever since the first FFV rolled out of the factory — the 1996 Ford Taurus, which actually could run on gasoline, ethanol and methanol — FFV owners have consistently not taken advantage of all these engines can do. Less than 10 percent of such drivers use E85. Part of the reason likely is that only a small percentage of the nation’s fueling stations offer it. But that proportion is rising: E15, which has twice as much ethanol as regular gasoline (which contains up to 10 percent ethanol already), is spreading around the country, and more stations are offering E85 as well.

Using higher ethanol blends, and less gasoline, has multiple benefits:

  • It’s cheaper for consumers. The Renewable Fuels Association says blending ethanol into the nation’s gasoline supply saves the average American family about $1,200 a year.
  • It’s a natural octane enhancer, which makes engines perform better.
  • Since ethanol burns more efficiently, it results in fewer tailpipe emissions being released into the air, which is better for air quality.
  • It’s an American-made fuel, requiring American-based jobs. The U.S. only produces less than 10 million barrels of crude a day but consumes some 19 million. The difference must be imported.

Check Your Car is part of our Fuels 101 initiative, which will soon include other features such as an education page about the various fuel types; how to find a station that sells alternative fuels (for the time being, use the Alternative Fuels Data Center’s locator); and how to find a kit that could convert your gasoline-only engine to run on ethanol.

So check back soon. In the meantime, kick the tires and take Check Your Car for a test drive.

Landon Hall

The flex-fuel Dodge Charger shows you can be both green and cool

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Aaron Walsh’s first car was a 2008 Chrysler Sebring flex-fuel, meaning it could take E85 or any other ethanol blend. It was a good car.

But his new car … wow. The 2012 Dodge Charger, in Tungsten Metallic gray. Now that’s a proper car for a young man. And Walsh never would have bought it if it didn’t come in a flex-fuel version.

“That’s my biggest reason for using it,” says the student from Haslett, Mich., just east of Lansing. “I absolutely hate the petroleum industry.”

His reasons are mostly environmental: the BP spill in the Gulf, etc. “I could go into it, but it would take a long time.”

The point is, he did something about it, and that something came around the time he decided he needed a vehicle upgrade. Walsh already knew the benefits of ethanol because of his father, who works for the state of Michigan, which encourages state employees to put E85 into their flex-fuel vehicles. So right around his 21st birthday, last June, he found the Charger and its 3.6-liter Pentastar V6 engine.

“I wanted something that didn’t have to run on gasoline,” he said. “And the first thing I wanted was an electric; I was really into the Chevy Volt. But then I realized a college student doesn’t have $40,000. Then I looked and saw that the Charger is $24,000.”

Walsh, who attends Lansing Community College, says finding an E85 station isn’t difficult. “It keeps getting easier and easier,” he says. He posts his fill-up data to his Twitter feed, @gasisoutrageous (his account name is #Number1BigHero6Fan … hey, dude has other interests besides ethanol), and he regularly gets in the twenties for mpg. Also, E85 is a lot cheaper than regular gasoline at many stations in the Lansing-Haslett area. Nationally, E85 was only $1.86 a gallon Thursday, 23.7 percent cheaper than E10, according to E85Prices.com.

Price isn’t the only benefit to buying E85. Higher ethanol blends burn more cleanly and efficiently than E10 (what most of us call regular gas). Using more alcohol fuels displaces oil, strengthening the overall U.S. economy, creating domestic jobs; reducing oil consumption is better for our air, water and health.

But the price at the pump is still a big factor, and most Americans know this. Walsh knows it, and needs it. He works at a convenience store, and says his dad has been helping him out covering the cost of payments and upkeep. The vehicle is also not exactly ideal for the brutal Michigan winters, with is rear-wheel and slick tires.

But he loves it. Using ethanol doesn’t mean you can’t enjoy your car at the same time. And that roaring engine runs great on high-octane E85.

“When I started driving, whenever I would slam on the accelerator pedal, I’d just hear dollar signs. Now I like the performance. I actually bought that car just because of the engine.”

Other posts in our “Share Your Story” series:

Landon Hall

Here’s what Americans are telling us about the price of gas

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We asked, and you delivered.

At the start of our “Share Your Story” campaign, Fuel Freedom Foundation sent out the call: Tell us how volatile gasoline prices, which peak and plunge without warning or explanation, affect your daily life.

We got dozens of responses, from all age groups and all regions of the country. Here are some of the best:

 

 “I would love cheaper gas prices, because my boyfriend and I share my van, and several days a week, I have to drive him to work, then go back home, run errands, or take kids to school, then go back and get him later. It takes a lot of gas to do that.”
— Eileen N., Selma, N.C.

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“I can’t raise my wage whenever I want. It’s hard to budget when you know they will raise the price every week — just ’cause they can, I guess.”
— Tim H., Coldwater, Michigan

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“Fuel prices are the only thing in my budget that I can’t consistently account for … it’s infuriating.”
— Manny L., Daly City, California

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“My new granddaughter lives in Odessa, and I can’t afford to take my medications AND go to see her on my fixed income. Groceries and goods are transported to stores by truck, and higher fuel prices are passed on to the consumer by increased food and goods prices. My dollar isn’t worth as much with the higher fuel prices. If gas goes up to $4 a gallon again, I will barely afford food and clothing, much less any traveling to see my granddaughter. Our economy will suffer greatly if fuel prices don’t stabilize around $2 a gallon or less.”
— Gary S., Rowlett, Texas

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“I spend about $300 to $500 a month in fuel. There are some months that we are struggling to pay for food. The trade-off is that the rent is cheaper the further you are from the city, but the gas is killing us.”
— Abe F.

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“I’m on SSDI [Social Security Disability Insurance]. When fuel prices go up or stay high, it’s really simple to explain: I have less food to eat, and I might not be able to buy all my medicine. I have also had to cancel some appointments. Sometimes doctors have to be put off for a later date!”
— Steven D., Des Plaines, Illinois

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“I drive a car with 40 miles to the gallon, and I am still struggling with gas prices. Especially soaring gas prices in Arizona. During the Super Bowl, gas prices dropped to $1.70 a gallon. It was such a stress relief having to pay $15 to fill up my gas tank for the week. But after that week was over, gas prices went up to $2.49 in just a week. It is unfair that big companies do this to people. I can’t even imagine how people live with bigger engines. Having to shovel $80 for a tank that lasts a week.”
— Thomas M., Phoenix

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“Gas prices have kept me from seeing my brother, who is 75 years old and lives 240 miles from me. He won’t be around forever, but the jerks screwing us with high gas prices will. I hope they someday get judged on making travel for the retired so hard. They need to lose all their money and see what it’s like.”
— Calvin

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We’ll be posting more responses over the next week or so. If you’re wondering what you can do about the unending rollercoaster of oil and gas prices, there’s plenty, so visit our Take Action page, where you can learn more about our mission to reduce oil consumption. You can sign our petition asking major fueling retailers, like Costco, to offer consumers alternative fuels.

Also, check out our companion site, which is all about the stupendously great documentary film PUMP.

Landon Hall

This guy watched PUMP, got mad, and went looking for E85

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Glenn Peterson watched PUMP the Movie on iTunes recently. And frankly, it made him angry. Which can be a good thing, if you take that anger and turn it into something constructive.

The part of the film that motivated Glenn to do his small part to end our oil addiction was when Jason Bateman, in that soothing voice of his, mentions that you can look on the Internet to find fueling stations that sell ethanol blends. As it happened, Glenn already owned a flex-fuel vehicle, a 2011 Chrysler Town & Country. Like 17 million other FFVs on the road in the U.S., it was made to run on E85.

Glenn went on E85Prices.com and found a Propel Fuels station about 10 miles from his home in San Diego that sells E85 (a blend that’s actually between 51 percent and 83 percent ethanol, the rest traditional gasoline).

“It was $3.06,” Glenn said, noting that regular 87-octane gas, E10, was selling for about 20 percent more. “So I filled up then, and anytime I thought of it afterwards, I would go there. It’s a little out of the way, but not that far out of the way.

“If a bunch of people do a bunch of small things, it’s like one big thing. And unfortunately … I talk to people at where I work about E85, and it’s just amazing, the misconceptions. I work with a lot of really smart computer people … it’s like they’ve got that part of their mind closed. And I don’t get it.”

Glenn, 54, bought the van in 2012, and a few months later he drove his family to his hometown of Minot, N.D., on vacation. He already knew about FFVs and E85, but even though he was on the lookout for stations that sold the fuel, he couldn’t find any. On the trip back, they pulled off I-80 in Rock Springs, Wyo., and spotted an E85 sign at a Kum & Go station.

“My wife took a picture of me fueling up. I was just so happy I finally found it!” Glenn said.

But his wife drove the van more than he did, and it was just more convenient to fill up at Costco whenever she went shopping there. Then came PUMP, and now the Petersons are an E85 family.

So what got him so angry watching it?

“I was just so mad at [Standard Oil baron John D.] Rockefeller for everything he did, to basically get us into the mess we are now. But I’ll also admit the government and … we basically let that happen to us. So we are as addicted to oil as we can be.

“And oh by the way, I called Costco. I talked the guy who runs their gas program and asked him why they didn’t have E85. He didn’t think there would be a demand. And I’m like, ‘Well, you’re mistaken, sir.”

That reminds us, Glenn: After you’re done watching PUMP and ready to get involved, one of our projects is to convince as many independent fueling retailers (the ones who aren’t obliged to sell a particular oil company’s gasoline) as possible to offer alternative fuels to their customers.

Sign our petition asking them to do just that. And keep sharing your stories about high gas prices and solutions with us! You can also join the conversation on Fuel Freedom’s Facebook page and on Twitter.

Arctic Leaf

Ethanol at the crossroads

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During an 18-month stretch, from June 2013 to December 2014, American-made ethanol was riding high. The industry produced 13.9 billion gallons and was making 63 cents per gallon, for an annual profit of $8.8 billion.

Then oil prices collapsed. The results have not been good for ethanol. Sales have been squeezed and profit margins have almost disappeared entirely. Ethanol producers must keep their price below the rate of gasoline, and that has become difficult. After gasoline fell below $2 per gallon in some places, ethanol was squeezed right out of the market. Instead of buying ethanol, refiners purchase Renewable Identification Numbers (RINs), which give them credit for putting ethanol into their blends. RINs have gained 36 percent in the past year, to 71.9 cents a gallon on the New York Mercantile Exchange, which shows how they have become a popular method of avoiding ethanol purchases.

As a result, major refiners are either throttling back or closing some of their higher-cost operations completely. The Valero Energy Corporation and Green Plains Renewable Energy, which together make up about 15 percent of U.S. ethanol capacity, have reduced their operations, according to Bloomberg. At a typical mill in Illinois, profit margins have virtually vanished after netting $1.33 per gallon only a year ago, according to AgTrader Talk, an Iowa consulting company. As a result, U.S. ethanol output fell 4.6 percent to an annualized rate of 14.5 billion gallons, from a record of 15.2 billion gallons, for the week ending Feb. 20, according to the Energy Information Administration.

All this illustrates how vulnerable ethanol will be if the Environmental Protection Agency ever gets around to publishing its “renewable fuel mandate” for last year or this. The EPA is supposed to issue a number each year for the amount of ethanol that will be incorporated into gasoline sales, in accordance with a 2007 law. But last year, with gasoline consumption actually declining because of economic weakness and improved fleet mileage, it became obvious that ethanol consumption could not reach the mandated level of 14.2 billion gallons without going over the mythical “blend wall” of 10 percent, at which point ethanol might damage some older engines. Most cars sold since 2004 can tolerate higher blends, and there are pumps where 85 percent ethanol is available. Still, the EPA has remained reluctant to abandon its conservative position and has tried to reconcile the 10 percent figure with declining gasoline consumption. Even the current 14.5- billion-gallon annual target would exceed the blend wall, and the EPA is in danger of sticking the country with too much ethanol. Inventories already stand at 21.6 million barrels, the highest level since 2012.

Added into all this is the price of corn, which remains the most widely used feedstock for U.S.-made ethanol. Last year the price of corn reached $8 per bushel and averaged $4.43 for the year. Ethanol refiners were still able to absorb the price because gas prices remained so high. But now gasoline prices have fallen by 50 percent, while the price of corn has only declined 19 percent, to $3.75 per bushel. Ethanol refiners say corn must reach $3.25 per bushel before they can make any money.

Chuck Woodside, CEO of KAAPA Ethanol and former president of the Renewable Fuels Association, says 2015 is looming as a critical year for ethanol. “We’re coming off a phenomenal 2014, and the industry as a whole did well,” he told the Kearney (Neb.) Hub newspaper. But “there are a lot of things yet to be determined about 2015.” Among them are how much drivers will increase their gasoline consumption (taking advantage of lower prices); whether more E15 and E85 pumps can be installed around the country; and whether the EPA will ever make up its mind on the Renewable Fuel Standard. There is even some question now of whether the EPA or Congress has the authority to set the RFS.

“The price of diesel has not fallen commensurate with the price of oil,” Woodside added. That only drives up the costs for ethanol plants, which use diesel-burning trucks and railroads to transport the product.

One bright spot has been the export market, in which American ethanol has been gaining ground. Demand has come particularly from Brazil, where 25 percent of all vehicles must run on 25 percent ethanol. Brazil has been under pressure to slow deforestation in the Amazon Basin, where most of its sugarcane ethanol is produced. China has also been a growing market for American ethanol products.

But refiners now agree that the best solution to the ethanol surplus would be to increase the number of pumps around the country that can dispense the E85 blend. That would produce a demand that would easily absorb all the ethanol American refiners could produce.

Arctic Leaf

What does loving America have to do with the whims and opportunity costing of the oil industry?

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The Greeks are going broke…slowly! The Russians are bipolar with respect to Ukraine! Rudy Giuliani has asked the columnist Ann Landers (she was once a distant relative of the author) about the meaning of love! President Obama, understandably, finds more pleasure in the holes on a golf course than the deep political holes he must jump over in governing, given the absence of bipartisanship.

2012-2015_Avg-Gas-Prices1-1024x665But there is good news! Many ethanol producers and advocacy groups, with enough love for America to encompass this past Valentine’s Day and the next (and of course, with concern for profits), have acknowledged that a vibrant, vigorous, loving market for E85 is possible, if E85 costs are at least 20 percent below E10 (regular gasoline) — a percentage necessary to accommodate the fact that E10 gas gets more mileage per gallon than E85. Consumers may soon have a choice at more than a few pumps.

In recent years, the E85 supply chain has been able to come close, in many states, to a competitive cost differential with respect to E10. Indeed, in some states, particularly states with an abundance of corn (for now, ethanol’s principal feedstock), have come close to or exceeded market-based required price differentials. Current low gas prices resulting from the decline of oil costs per barrel have thrown price comparisons between E85 and E10 through a bit of a loop. But the likelihood is that oil and gasoline prices will rise over the next year or two because of cutbacks in the rate of growth of production, tension in the Middle East, growth of consumer demand and changes in currency value. Assuming supply and demand factors follow historical patterns and government policies concerning, the use of RNS credits and blending requirements regarding ethanol are not changed significantly, E85 should become more competitive on paper at least pricewise with gasoline.

Ah! But life is not always easy for diverse ethanol fuel providers — particularly those who yearn to increase production so E85 can go head-to-head with E10 gasoline. Maybe we can help them.

Psychiatrists, sociologists and poll purveyors have not yet subjected us to their profound articles concerning the possible effect of low gas prices on consumers, particularly low-income consumers. Maybe, just maybe, a first-time, large grass-roots consumer-based group composed of citizens who love America will arise from the good vibes and better household budgets caused by lower gas prices. Maybe, just maybe, they will ask continuous questions of their congresspersons, who also love America, querying why fuel prices have to return to the old gasoline-based normal. Similarly, aided by their friendly and smart economists, maybe, just maybe, they will be able to provide data and analysis to show that if alternative lower-cost based fuels compete on an even playing field with gasoline and substitute for gasoline in increasing amounts, fuel prices at the pump will likely reflect a new lower-cost based normal favorable to consumers. It’s time to recognize that weakening the oil industry’s monopolistic conditions now governing the fuel market would go a long way toward facilitating competition and lowering prices for both gasoline and alternative fuels. It, along with some certainty concerning the future of the renewable fuels program, would also stimulate investor interest in sorely needed new fuel stations that would facilitate easier consumer access to ethanol.

Who is for an effective Open Fuel Standard Program? People who love America! It’s the American way! Competition, not greed, is good! Given the oil industry’s ability to significantly influence, if not dominate, the fuel market, it isn’t fair (and maybe even legal) for oil companies to legally require franchisees to sell only their brand of gasoline at the pump or to put onerous requirements on the franchisees should they want to add an E85 pump or even an electric charger. It is also not right (or likely legal) for an oil company and or franchisee to put an arbitrarily high price on E85 in order to drive (excuse the pun) consumers to lower priced gasoline?

Although price is the key barrier, now affecting the competition between E85 and E10, it is not the only one. In this context, ethanol’s supply chain participants, including corn growers, and (hopefully soon) natural gas providers, need to review alternate, efficient and cost-effective ways to produce, blend, distribute and sell their product. More integration, cognizant of competitive price points and consistent with present laws and regulations, including environmental laws and regulations, is important.

The ethanol industry and its supporters have done only a fair to middling job of responding to the oil folks and their supporters who claim that E15 will hurt automobile engines and E85 may negatively affect newer FFVs and older internal combustion engines converted to FFVs. Further, their marketing programs and the marketing programs of flex-fuel advocates have not focused clearly on the benefits of ethanol beyond price. Ethanol is not a perfect fuel but, on most public policy scales, it is better than gasoline. It reflects environmental, economic and security benefits, such as reduced pollutants and GHG emissions, reduced dependency on foreign oil and increased job potential. They are worth touting in a well-thought-out, comprehensive marketing initiative, without the need to use hyperbole.

America and Americans have done well when monopolistic conditions in industrial sectors have lessened or have been ended by law or practice (e.g., food, airlines, communication, etc.). If you love America, don’t leave the transportation and fuel sector to the whims and opportunity costing of the oil industry.

Arctic Leaf

Alternative and renewable fuels: There is life after cheap gas!

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usatoday_gaspricesSome environmentalists believe that if you invest in and develop alternative replacement fuels (e.g., ethanol, methanol, natural gas, etc.) innovation and investment with respect to the development of fuel from renewables will diminish significantly. They believe it will take much longer to secure a sustainable environment for America.

Some of my best friends are environmentalists. Most times, I share their views. I clearly share their views about the negative impact of gasoline on the environment and GHG emissions.

I am proud of my environmental credentials and my best friends. But fair is fair — there is historical and current evidence that environmental critics are often using hyperbole and exaggeration inimical to the public interest. At this juncture in the nation’s history, the development of a comprehensive strategy linking increased use of alternative replacement fuels to the development and increased use of renewables is feasible and of critical importance to the quality of the environment, the incomes of the consumer, the economy of the nation, and reduced dependence on imported oil.

There you go again say the critics. Where’s the beef? And is it kosher?

Gasoline prices are at their lowest in years. Today’s prices convert gasoline — based on prices six months ago, a year ago, two years ago — into, in effect, what many call a new product. But is it akin to the results of a disruptive technology? Gas at $3 to near $5 a gallon is different, particularly for those who live at the margin in society. Yet, while there are anecdotes suggesting that low gas prices have muted incentives and desire for alternative fuels, the phenomena will likely be temporary. Evidence indicates that new ethanol producers (e.g., corn growers who have begun to blend their products or ethanol producers who sell directly to retailers) have entered the market, hoping to keep ethanol costs visibly below gasoline. Other blenders appear to be using a new concoction of gasoline — assumedly free of chemical supplements and cheaper than conventional gasoline — to lower the cost of ethanol blends like E85.

Perhaps as important, apparently many ethanol producers, blenders and suppliers view the decline in gas prices as temporary. Getting used to low prices at the gas pump, some surmise, will drive the popularity of alternative replacement fuels as soon as gasoline, as is likely, begins the return to higher prices. Smart investors (who have some staying power), using a version of Pascal’s religious bet, will consider sticking with replacement fuels and will push to open up local, gas-only markets. The odds seem reasonable.

Now amidst the falling price of gasoline, General Motors did something many experts would not have predicted recently. Despite gas being at under $2 in many areas of the nation and still continuing to decrease, GM, with a flourish, announced plans, according to EPIC (Energy Policy Information Agency), to “release its first mass-market battery electric vehicle. The Chevy Bolt…will have a reported 200 mile range and a purchase price that is over $10,000 below the current asking price of the Volt.It will be about $30,000 after federal EV tax incentives. Historically, although they were often startups, the recent behavior of General Motor concerning electric vehicles was reflected in the early pharmaceutical industry, in the medical device industry, and yes, even in the automobile industry etc.

GM’s Bolt is the company’s biggest bet on electric innovation to date. To get to the Bolt, GM researched Tesla and made a $240 million investment in one of its transmissions plan.

Maybe not as media visible as GM’s announcement, Blume Distillation LLC just doubled its Series B capitalization with a million-dollar capital infusion from a clean tech seed and venture capital fund. Tom Harvey, its vice president, indicated Blume’s Distillation system can be flexibly designed and sized to feedstock availability, anywhere from 250,000 gallons per year to 5 MMgy. According to Harvey, the system is focused on carbohydrate and sugar waste streams from bottling plants, food processors and organic streams from landfill operations, as well as purpose-grown crops.

The relatively rapid fall in gas prices does not mean the end of efforts to increase use of alternative replacement fuels or renewables. Price declines are not to be confused with disruptive technology. Despite perceptions, no real changes in product occurred. Gas is still basically gas. The change in prices relates to the increased production capacity generated by fracking, falling global and U.S. demand, the increasing value of the dollar, the desire of the Saudis to secure increased market share and the assumed unwillingness of U.S. producers to give up market share.

Investment and innovation will continue with respect to alcohol-based alternative replacement and renewable fuels. Increasing research in and development of both should be part of an energetic public and private sector’s response to the need for a new coordinated fuel strategy. Making them compete in a win-lose situation is unnecessary. Indeed, the recent expanded realization by environmentalists critical of alternative replacement fuels that the choices are not “either/or” but are “when/how much/by whom,” suggesting the creation of a broad coalition of environmental, business and public sector leaders concerned with improving the environment, America’s security and the economy. The new coalition would be buttressed by the fact that Americans, now getting used to low gas prices, will, when prices rise (as they will), look at cheaper alternative replacement fuels more favorably than in the past, and may provide increasing political support for an even playing field in the marketplace and within Congress. It would also be buttressed by the fact that increasing numbers of Americans understand that waiting for renewable fuels able to meet broad market appeal and an array of household incomes could be a long wait and could negatively affect national objectives concerning the health and well-being of all Americans. Even if renewable fuels significantly expand their market penetration, their impact will be marginal, in light of the numbers of older internal combustion cars now in existence. Let’s move beyond a win-lose “muddling through” set of inconsistent policies and behavior concerning alternative replacement fuels and renewables and develop an overall coordinated approach linking the two. Isaiah was not an environmentalist, a businessman nor an academic. But his admonition to us all to come and reason together stands tall today.

Landon Hall

Meet the PUMP players: Phil and Cheryl Near, selling ethanol as God’s work

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One of the most compelling moments in the documentary PUMP comes when we’re introduced to Phil and Cheryl Near, who own two gas stations called Jump Start in Wichita, Kansas.

They’re not ordinary stations, however: They could be the fueling stations of the future, because they sell ethanol as well as traditional gasoline.

Phil Near, 51, has worked in the gasoline business virtually his entire adult life, and only a few years back discovered that there were alternatives, like ethanol. Now he and Cheryl offer it to customers, spreading the word about the benefits of fuel choice. “Once they try it, they usually come back and buy it again,” Phil says in the film.

More importantly, he says selling ethanol “is a moral obligation. We feel like we’re doing the Lord’s work.”

To learn more about the film, visit PumpTheMovie.com, and just in time for Christmas, you can give the gift of thought-provoking debate by pre-ordering your digital copy on iTunes prior to its Jan. 13 launch.

Until then, here’s a Q&A we did with Phil and Cheryl recently about their work and their passion:

Fuel Freedom: People who believe in alternatives to oil were caught off guard by the drop in oil prices. How do you handle it when people say: “Gas is so cheap, so why do we need to consider alternatives?”

Phil: People who have made the decision to use E85 are going to do that, as long as it doesn’t cost them more money. Some will use it no matter what. I think that having a lower price, where the economics are better for the consumer, will continue to drive new customers as they acquire cars that are flex vs. cars that are not. (The price) is inverted right now: It actually costs us more money than gasoline does now. So we’re losing margin today because we feel like we have to be competitive between the two products to maintain our customer base. That’s not necessarily a good place to be, but it’ just kind of a reality of the fuel business. … Sometimes you just have to bite the bullet, and you don’t like it, but you’ve got to just fight the fight.

FF: How much do you pay for the ethanol you sell?

Phil: At one store we sell E85, and then we have the three grades of gasoline (87, 89 and 91). At the second store we have 87 and 91, then we have E15, E30 and E85. Our cost today on unleaded is a little over $2, retails $2.28, which is an abnormally large margin because the price is falling faster at the rack than the street, but it’s catching up. E85, we’re matching the unleaded price, $2.28. But it’s costing us about 15 cents a gallon more than that.

FF: What needs to happen to move the needle to create more flex-fuel vehicles, or create more stations?

Cheryl: One of the big things is education. My daughter had a car worked on at a dealership in town. I was talking to some of the service guys … and I talked about what we do, (that) we sell E85. And this guy goes, “Oh, I tell all my customers, ‘Don’t put E85 in your car. It’s bad for your car; it burns hotter.’ “ And I go, ‘Well, actually, it burns cooler, and higher octane is good for your car.’ “ But the oil companies have spent so much money with all this negative propaganda, and a lot of people have fallen into it. Car dealerships are the worst. They are telling their people not to use E85 in their flex-fuel vehicles, from the experiences that I’ve had.

FF: It’s amazing that a dealership would tell someone not to put E85 in a flex-fuel vehicle when it’s built to run on it.

Cheryl: And in the state of Kansas, there’s a $750 tax credit, if you use 500 gallons in a calendar year. And the dealerships aren’t telling people, they’re not promoting that. So people could be using E85 and getting that tax credit, and they’re just leaving it on the table, because the dealerships – whether they don’t know about it, or they just don’t want to tell people about it – it’s not being promoted.

FF: In the film you talk about selling ethanol being “the Lord’s work.” What does that mean to you?

Phil: At one time I had one of the largest fuel-distribution companies in the Midwest (Crescent Oil Co.). And it really wasn’t until I was out of that company that I understood how much control not only do the oil companies have on what happens here in the U.S., but how much control there is worldwide on energy. And I have a real passion for the fact that I feel like our great country is being stripped of its wealth for energy, and our jobs are going away. We’re right on the edge of Oklahoma, so during the oil heyday, we saw what that did economically for the communities and the people. And when the oil business went away, it really damaged a lot of towns in Oklahoma, and southern Kansas, and Texas. Back in 2006, I started learning a little bit about E85 and kind of the push, with a few ethanol plants being built in the Midwest. I saw what it does as far as creating opportunities. In small towns, these rural towns where these plants are being built, it’s a major impact on the communities.

But what most people don’t even think about every time they fill their car up with gas is, we’re sending the money we pay for energy out of our country. I call it “stripping the wealth.” Obviously, renewables is what I really feel like we’re supposed to be doing. Obviously it’s better for the economy, it’s better for the environment. We’re stewards of this Earth, and we need to be taking care of it. Oil is dirty energy; coal is dirty energy. These things that pollute the environment, as well as really hurt the financial position of our great country.

Cheryl: As a female and a mother, my biggest fear is that we’ll be a generation (or maybe the next generation) that completely depletes all of the fossil-fuel reserves, and then we’re leaving great-grandchildren, great-great-grandchildren, in a mess. This generation, if we don’t start working on this, we’re leaving a really big mess for future generations. I really worry about that. In the Bible, it says we’re supposed to be stewards of the Earth. God left it for us to take care of. I say it in the documentary: “I think we’re messing up.” I don’t think we’re doing a very good job.

Phil: I was taught something that really hit home, and that was: You can’t create energy; you can only transfer energy. Only the Lord created energy. And whether you transfer it from oil, or from wind or solar, or ethanol, from corn or whatever you may, we’re all missing the boat. It’s all transfer, it’s not created.

Cheryl: That actually came from my father (Ray Jones), who’s an engineer. But he was teaching us that: He said, ‘You can’t make energy, you transfer energy. And you lose a little energy every time you transfer it.’ We’d never really heard that before. We were kind of fascinated by that.

Phil: He was one of the design engineers on the NASA moon buggy; he was a pretty smart cat. But he taught us that. And every source (of energy) was one the Lord gave us.

I spent my whole career in the industry, and most people don’t stop and think, and I didn’t for a long time, that our economic model for the world is all controlled by energy. Everything. You can’t get food without energy, you can’t move goods and services. Everything is driven off energy, and we’ve been sending soldiers to war for a long time to protect energy that we don’t even own.

Fuel Freedom Staff

Report declares opportunity for growth in E85 market

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NACSonline reported that there are opportunities to grow the E85 market — but only if prices remain significantly below those of regular grade gasoline and the automobile industry continues to produce flex-fuel vehicles at historic rates, according to a new report released today by the Fuels Institute.

Depending upon the likelihood of various scenarios, E85 sales will, at a minimum, double by 2023 — but could experience a 20-fold increase in sales over the same time period, according to the 40-page report, “E85: A Market Performance Analysis and Forecast.”

Researchers evaluated the performance of more than 300 stores that sell E85, also known as flex fuel, and developed forecasts taking into account a variety of factors that could ultimately affect sales. The Fuels Institute projects that E85 sales will increase from 196 million gallons in 2013 to between 400 million and 4.4 billion gallons in 2023.

Biofuels have experienced remarkable growth over the past 12 years, from 1.75 billion gallons sold in 2001 to 14.54 billion gallons sold in 2013. While the bulk of that growth has been from the embrace of E10, future biofuels sales growth will be highly dependent upon increasing the sale E85, a blend of gasoline with 51 to 83% ethanol.

Read more at: The Auto Channel

Arctic Leaf

The decline of oil and gas prices, replacement fuels and Nostradamus

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“It’s a puzzlement,” said the King to Anna in “The King and I,” one of my favorite musicals, particularly when Yul Brynner was the King. It is reasonable to assume, in light of the lack of agreement among experts, that the Chief Economic Adviser to President Obama and the head of the Federal Reserve Bank could well copy the King’s frustrated words when asked by the president to interpret the impact that the fall in oil and gasoline prices has on “weaning the nation from oil” and on the U.S. economy. It certainly is a puzzlement!

What we believe now may not be what we know or think we know in even the near future. In this context, experts are sometimes those who opine about economic measurements the day after they happen. When they make predictions or guesses about the behavior and likely cause and effect relationships about the future economy, past experience suggests they risk significant errors and the loss or downgrading of their reputations. As Walter Cronkite used to say, “And that’s the way it is” and will be (my addition).

So here is the way it is and might be:

1. The GDP grew at a healthy rate of 3.5 percent in the third quarter, related in part to increased government spending (mostly military), the reduction of imports (including oil) and the growth of net exports and a modest increase in consumer spending.

2. Gasoline prices per gallon at the pump and per barrel oil prices have trended downward significantly. Gasoline now hovers just below $3 a gallon, the lowest price in four years. Oil prices average around $80 a barrel, decreasing by near 25 percent since June. The decline in prices of both gasoline and oil reflects the glut of oil worldwide, increased U.S. oil production, falling demand for gasoline and oil, and the likely desire of exporting nations (particularly in the Middle East) to protect global market share.

Okay, what do these numbers add up to? I don’t know precisely and neither do many so-called experts. Some have indicated that oil and gas prices at the pump will continue to fall to well under $80 per barrel, generating a decline in the production of new wells because of an increasingly unfavorable balance between costs of drilling and price of gasoline. They don’t see pressure on the demand side coming soon as EU nations and China’s economies either stagnate or slow down considerably and U.S. economic growth stays below 3 percent annually.

Other experts (do you get a diploma for being an expert?), indicate that gas and oil prices will increase soon. They assume increased tension in the Middle East, the continued friction between the West and Russia, the change of heart of the Saudis as well as OPEC concerning support of policies to limit production (from no support at the present time, to support) and a more robust U.S. economy combined with a relaxation of exports as well as improved consumer demand for gasoline,

Nothing, as the old adage suggests, is certain but death and taxes. Knowledge of economic trends and correlations combined with assumptions concerning cause and effect relationships rarely add up to much beyond clairvoyance with respect to predictions. Even Nostradamus had his problems.

If I had to place a bet I would tilt toward gas and oil prices rising again relatively soon, but it is only a tilt and I wouldn’t put a lot of money on the table. I do believe the Saudis and OPEC will move to put a cap on production and try to increase prices in the relatively near future. They plainly need the revenue. They will risk losing market share. Russia’s oil production will move downward because of lack of drilling materials and capital generated by western sanctions. The U.S. economy has shown resilience and growth…perhaps not as robust as we would like, but growth just the same. While current low gas prices may temporarily impede sales of electric cars and replacement fuels, the future for replacement fuels, such as ethanol, in general looks reasonable, if the gap between gas prices and E85 remains over 20 percent — a percentage that will lead to increased use of E85. Estimates of larger cost differentials between electric cars, natural gas and cellulosic-based ethanol based on technological innovations and gasoline suggest an extremely competitive fuel market with larger market shares allocated to gasoline alternatives. This outcome depends on the weakening or end of monopolistic oil company franchise agreements limiting the sale of replacement fuels, capital investment in blenders and infrastructure and cheaper production and distribution costs for replacement fuels. Competition, if my tilt is correct, will offer lower fuel prices to consumers, and probably lend a degree of stability to fuel markets as well as provide a cleaner environment with less greenhouse gas emissions. It will buy time until renewables provide a significant percentage of in-use automobiles and overall demand.