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Ethanol is More Expensive than Gasoline Over Time

Posted: Jun 03, 2008 10:39 a.m.

Ethanol, we were once told, was a clean, renewable energy source that could power our cars for less money than gasoline.  It's increasingly clear to the automotive press, however, that there is nothing to support these claims. 

Kicking Tires reports, "Not only has E85 been oversold as a clean fuel, but if you insist on filling your vehicle with the 85% ethanol blend, you'll also be losing money at the pump."  The problem?  "While E85 costs less than regular gasoline, your engine doesn’t burn it as efficiently. As of Friday, AAA's Fuel Gauge Report puts the average price of E85 at $3.284 a gallon (well below the price of gas, which was $3.962 on Friday), but it adjusts the price based on the fuel’s lost efficiency compared to gasoline.  The actual average price when you factor in E85’s poor fuel economy? $4.321 per gallon."

Even the U.S. Postal Service has almost given up on the stuff.  Autoblog Green reports that USPS experiment in using flexfuel vehicles "is revealing some terrible results."  The USPS is altering its plan to use flexfuel trucks after an audit showed that the vehicles "not only saw a decreased fuel efficiency of 29 percent, but also ended up forcing the USPS to use 1.5m gallons more gasoline than before. Why? Because the USPS couldn't buy and use E85 everywhere it wanted to and so the flexfuel engines - which were larger than the ones they replaced - were thirsty and burned more fuel."  The Postal Service will now limit use of flexfuel vehicles only to places where the fuel is "competitively priced and conveniently available."

They may have trouble finding any.  Jalopnik explains, "Even in states that subsidize the cost of the fuel, like New York and Iowa, the difference still results in prices that are equal to or worse than the price of regular gasoline."  Though some argue that E85 is still a worthwhile investment for environmental reasons, Jalopnik says that any environmental benefit "is offset by the disruption of food crops and the fertilizer runoff that is impacting the Gulf of Mexico."

Looking for a car that will help you save at the pump?  Research the best small cars and hybrids with U.S. News' car rankings and reviews.