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Washington, D.C. - On October 1, 1908, Henry Ford watched as his first Model T automobile rolled off the production lines in Detroit. The first American mass-produced vehicle was designed to run on ethanol. Ford's vision was to build a vehicle affordable to the working family and powered by a fuel that would boost the rural farm economy. Many factors, including the low cost of petroleum, kept his vision from becoming reality throughout the 20th century. But today, during the dawn of a new millennium, ethanol is becoming more attractive to consumers.
The rising cost of gasoline, the desire for energy security, and an interest in a cleaner environment are enabling ethanol to emerge as a leading candidate to replace gasoline as the fuel of choice for motorists.
U.S. consumption of ethanol last year reached 4 billion gallons, which is double the amount sold in the year 2000. In an effort to maintain this tremendous pace of growth, The Energy Policy Act, signed on August 8, 2005, establishes minimum requirements for the amount of renewable fuel that must be included in gasoline.
Today, ethanol is used mostly as a gasoline additive. You will often find that the gasoline you purchase is ten percent ethanol in an effort to cut pollution, boost octane, and extend gasoline supplies. But its use is beginning to expand. A new blend of fuel, known as E85, combines 85% ethanol with 15% gasoline.
Some retailers around the country are pricing E85 at nearly $1.00 less per gallon than gasoline. E85 can only be used in designated Flexible Fuel Vehicles (FFV). More than 6 million of these FFV vehicles are on the road today. The major car manufacturers, such as Ford, General Motors, and Daimler Chrysler, are producing them in greater abundance. Ford has produced 1.5 million already, and will make 250,000 FFVs this year. General Motors claims a similar number on the road, and has launched a national advertising campaign to market their FFV fleet. Daimler Chrysler is expanding production, as well.
While the number of FFVs on the road is starting to expand rapidly, the number of gas stations providing E85 at the pump is growing extremely fast. There are currently fewer than ten stations that provide E85 in the state of Ohio. The first retail location in Cincinnati is slated to open this month. But as the price of gasoline rises and demand for ethanol grows, more and more stations will offer E85. Bipartisan legislation before Congress will provide further incentives for stations to offer the new fuel.
E85 presents a positive opportunity for our economy and for the American farmer. New and expanding markets that create additional demand for corn and other crops will invigorate farm production. That would mean more money pumped into our American economy and less money going to OPEC.
For security and economic reasons, our nation needs to develop a fuel system that can become independent of OPEC. The cost of gasoline continues to increase and so does the burden that it places on family budgets. Ethanol will soon provide both price relief and the opportunity to buy American with every trip to the pump. It will also enable us to reduce our dependence to an increasingly dangerous region of the world.
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