Re: [MLUG - DISCUSSION] How Many Miles to the Bushel?

[Mike Miller <EMAIL:PROTECTED>]

On Sat, 3 Jun 2006, Vern Green wrote:

> I guess whether E85 is twice as much or not would depend a lot on the 
> vehicle you drive. Here is a nice chart that shows the cost between 
> gasoline, gas mileage of gasoline and E85 and the pollution produced. 
> Pretty nice as it is broken down by model of vehicle as well.
>
> http://www.fueleconomy.gov/feg/byfuel/FFV2000.shtml
>
> It does not support the claim that E85 is twice as expensive, it does 
> support that E85 is not as efficient, which makes it more expensive even 
> if the cost per gallon is only .30 less than gasoline.

Those numbers are more encouraging than the NY Times numbers.  It looks 
like mpg for E85 is about 75% of that for gasoline, so if we can get the 
price of E85 down to 75% of the price of gasoline, we'll be braking even. 
It looks like we are at about 80-85% of the price of gasoline.  So it 
isn't far off.

One tricky problem is to predict future prices.  Thinking in terms of 
supply and demand -- as the production of E85 increases, the supply 
increass and the price drops, but when the price drops, more E85 vehicles 
will be produced and the demand will increase.  As the demand increases, 
the price will increase and more production will follow.  So what happens 
in the long term?  Is there a way to predict?  My guess is that the market 
forces might push the price of E85 to where it is very close to gasoline 
in the total cost of driving.  I am guessing this because vehicles that 
can burn both fuels will choose one or the other depending on current 
price.  When E85 costs more per mile than gasoline, they will choose E85 
which will increase the price of E85 until they choose gasoline again 
which will lower the price of E85.  If I am correct, this situation will 
tend to work pretty well for us because it will mean that E85 may stick 
around for a long time and help us to reduce greenhouse gases while 
reducing dependence on oil.  Oh -- also important is that increased 
availability of the new fuel source should bring down the price of both 
gasoline and E85.

Regarding greenhouse gas emissions -- E85 probably puts out a lot less 
greenhouse gas per gallon burned, but because of lower mpg, you have to 
burn more gallons to travel the same distance and this makes E85 more 
similar to gas in total emissions than you might expect at first.

Mike

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