Quote:
Originally Posted by redpoint5
There are many reasons not to subsidize sugarcane, along with most anything else. Artificially manipulating supply/demand by taking money from tax payers and re-distributing to special interest groups is inefficient, unethical, and almost always has unforeseen negative externalities.
It distorts the true cost of producing something.
Here...
As for the cost... <images snipped>
Nebraska has the biggest E85 to E10 gas spread, but it too falls short of delivering more energy per dollar. Wackyfornia has only an 18% spread, when the break-even price would need to be more than 30%. In the state I currently live, E85 has only a 5% difference in price with E10. 
Since E85 has only 70% of the energy content of gasoline, it needs to cost 70% or less the price of gasoline.
This is the part that pisses me off the most. A bottle of Everclear costs a small fortune, but a gallon of ethanol for burning in a car is relatively cheap. The gov't has no business making small quantities of alcohol cost a lot, and making large quantities unsuitable for consumption.
It's like I live in an insane as asylum and none of the patients realize they are crazy. |
1. I don't usually endorse subsidies either, but sometimes market forces are such that business cases can't be made for things we think will work
in the initial stages of development/introduction. A major ethanol subsidy HAS been dropped. If we want to continue to debate any other subsidies we have to include petrol subsidies and we also have to acknowledge there is damn little "free market" anywhere as it all operates within (or is affected by) a system of regulations.
2. As I noted earlier, attempting to equate dollars to BTUs is rubbish. Just forget it already and look at what happens where the rubber meets the road: CENTS PER MILE COST.
3. Is it the government that causes Everclear to cost that much more than fuel-grade ethanol? Certainly taxes are part of it but I'd wager the biggest part of it is "free market" forces i.e. they're gonna charge what the market will bear. It is the brewer and the consumer that settle on a price.
4. I love the stories about Joe Schmuck filling up his FFV Subdivision with E85 that costs more per gallon than regular then whining about the double whammy of more expensive fuel and less mpg. The key is to not be an idiot. Only buy and run straight E85 when the price spread tells you it's worth it! I don't buy E85 when the spread is too close either. But an important thing to realize is that when running up to 50/50 blends, mpgs are basically unchanged. What this means is the spread doesn't have to be very much at all to cut the cost of the gallons in your tank while still going the same distance.
P.S. 5. Cost isn't necessarily the only purchase decision motivator. One can pick any number of reasons to want to reduce petrol consumption; if these are strong enough there doesn't have to be any ethanol price advantage at all.