Ethanol-blended petrol is a great fuel, so what's the fuss?

The benefit to citizens of urban airsheds is enormous. Cleaner air means healthier people, especially those that suffer from respiratory diseases. Mortality rates will improve, health care visits will decrease in number and severity, health care costs and insurance rates will benefit, and productivity will improve as absenteeism and performance is improved.

Experience

Ethanol has been blended in the US in significant levels since the early 1980s, and today blends of no more than 10per cent are warranted for use in every internal combustion engine sold, whether two stroke or four, land or water use, big engine or small. These are the same types of cars and marine engines sold in Australia, and there is no reason that ethanol blends at 10per cent or less will not work just fine. Additionally, in the US, there is a growing fleet of Fuel Flexible Vehicles (FFV) that runs on straight gasoline, straight ethanol, or anything in between. The number of stations dispensing the preferred fuel, E85, is growing. There are government incentives to car manufacturers for producing FFV.

Here at home, E10 has been trialled by BP successfully in the Brisbane market since April of 2002, with no negative incidents recorded. Over this same period, Q Fleet vehicles have also successfully run on E10. There has been intermittent blending in Queensland historically since 1927. Brazil, which also has abundant sugar resources, began blending during World War I. Today, all gasoline in Brazil contains 22per cent ethanol, and some fuel is straight ethanol. All cars in Brazil are specially designed for these levels of addition.

There are other countries besides the US, Brazil, and Australia that are incorporating ethanol into their motor fuels pool. In one form or another Sweden, France, Spain, India, Canada, Mexico and Thailand are actively using bio-ethanol at some substantial level.

Ethanol energy balance compared to gasoline.

Ethanol yields more energy net to the planet than it takes to produce it. Gasoline, or any fuel derived from fossil sources such as petroleum, cannot possibly do so. You are always at a deficit because you must consume some of the energy contained in the fuel to transport and process it, and you never get anything back. The carbon oxides from combustion add to the atmospheric inventory of other Greenhouse Gases.

With ethanol, the carbon dioxide produced either during fermentation or combustion will be remade into exactly the same amount of plant matter from which it was made. This photosynthetic cycle is what is meant by the renewable nature of ethanol, which in fact is classified as a solar fuel. Doing a complete energy balance, to include inputs at all levels of processing and giving credits where due, still makes for a positive balance using modern methods of farming and ethanol manufacture. This is an important part of what is meant by ethanol being sustainable.

Since carbon dioxide (CO2) is also heavily implicated in the atmospheric build-up of gases that are suspected agents of global climate change, it follows that, if the energy balance of ethanol is improved over fossil fuels, then burning it as a partial replacement for fossil fuels will help to abate these Greenhouse Gases. Further, there are two other subtle ways that ethanol helps in this area: (1) because unburned fuel is reduced in the tailpipe, more of it is being burned to useful work, and therefore additional fossil fuel will be saved; and (2) because of its high octane contribution, ethanol substitutes for aromatics, which give higher yields of CO2.

Another aspect of sustainability involves concerns about stress on the lands and tidal waters if ethanol use increases farming. There is little danger of this, as Australia can divert a portion of the agricultural commodities now shipped in export at increasingly low prices into ethanol manufacture, moving their value up the chain and improving prices for the remaining exports. Not one extra plot of land need be farmed to provide food on Australian tables and to produce fuel ethanol for our domestic needs.

Energy security.

Ethanol is a ready-to-use fuel that can be blended directly into gasoline. Australian refineries convert about 40per cent of crude runs to usable petrol. Therefore, one litre of ethanol produced in Australia substitutes for more than two litres of imported crude oil. This is not only helpful to the balance of payments but also provides us security of fuel supplies with content that is not dependent on foreign and uncontrolled sources. As a corollary, increasing numbers of jobs, in the rural areas where they are needed, will be created with widespread E10 usage.

Limit of ethanol in petrol.

Strong evidence exists that ethanol blends up to 10per cent are, in the words of the US Environmental Protection Agency, "substantially similar to gasoline." Every manufacturer of petrol-burning engines, for any transport application in the US, warrants the use of E10 as acceptable, and some go so far as to recommend it.

While there is no compelling evidence that blends up to 20per cent might cause harm to the current and future fleet of Australian automobiles, neither is there any evidence that harm will not be done, other than good fortune in the experiences so far.

Until such time as credible evidence proves otherwise, and the production of ethanol in Australia is so great that we can afford to provide some blends higher in percentage than E10, it is the opinion of this author that prudence requires that a limit of 10per cent be applied.

What is needed?

In order to grow a viable fuel ethanol industry, the federal government needs to establish a clear policy in support of alternative biofuels, and especially ethanol for petrol. The following actions are suggested for ethanol: (1) set volume targets with a timetable, (2) long term excise relief (or domestic producers credit) is needed to give lenders faith that debt will be repaid, (3) provide a capital subsidy for new ethanol capacity to attract investment capital from potential owners, (4) devise a mechanism to ensure market access, and (5) legislate fuel standards that include renewable fuels such as ethanol. These actions will level the playing field for all stakeholders in the fuel markets and give Australia a good chance or bringing to life a new and valuable industry.