Saturday, January 10, 2009

What should E85 cost? 1/10/09 edition

By my calculations, $1.69 a gallon! That's what I just paid!

For once, we're not being gouged by Meijer. Cool!


briefs said...

So when unleaded gets to $2.00 then E85 makes sense ... otherwise when gas is lower E85 doesn't really work. Remember too that E85 is being artificially held low by government handouts. I'd like to see those eliminated.

We missed you at the NW Indiana blogger meetup this week. Hope to get you more connected to the group, if you're on twitter follow me (the profile I use to get us all more traffic)

Anonymous said...

breifs- keep in mind that about half of those handouts you refer to are due to motor fuels not being taxed by btu content. For example; Up here in Wisconsin the state and federal taxes added together are 51.3 cents for gas and 57.3 cents for diesel (yes the fed's allow 6 cents more tax for diesel due to btu content and heavy weight diesel powered trucks). Ethanol contains 76,000 btu/ gal while diesel is approx 138,000 btu (55%)- Thus .55X 57.3= 31.52 cents for ethanol vs the 51.3
it is charged before the tax credit. Basically all I am saying is that before the tax credit is rolled down from it's present level one must fix the tax equity problem that exists currently- half of the tax credit is being used to compensate for this today rather than really being a "handout". What really then in question is 25 cents on pure ethanol or 19.5 cent per gallon based on E78 (the average ethanol content of E85 year 'round).