ETHANOL INFORMATION OVERVIEW
CONSUMER BENEFITS:
· Consumers use more than 10.5 billion gallons of high performance, cleaner
ethanol blended gasoline each year.
· Ethanol and ethyl tertiary butyl ether (ETBE) increase oxygenated supplies,
reducing the need for methyl tertiary butyl ether (MTBE) imports and help
to reduce consumer costs.
· Ethanol is a high octane blending component used by many independent
gasoline marketers -- creating competition for the major oil companies.
· ETBE is a low volatile oxygenate which provides refiners a cost-effective
means to meet Clean Air Amendment standards.
· Ethanol blends can be used in virtually all gas engines without any engine
or mechanical revisions.
· Ethanol guards against gas line freeze by absorbing moisture that may
get in the tank during cold weather.
TAXPAYER BENEFITS:
· The partial excise tax exemption for ethanol blends that are available to
gasoline marketers saves money.
· A GAO study has shown that reduced farm program costs and increased
income tax revenues offset the cost of the incentive.
· According to the USDA, if ethanol use does not continue to grow,
"deficiency payments for corn and other program crops will increase by
$580 million for crop year 1998 and $740 million by 2000" -- more than the
cost of the tax incentive.
· The economic activity caused by the ethanol industry will generate $3.5
billion in additional income tax revenue over the next five years -- $1
billion more than the cost of the exemption.
· The U.S. ethanol industry will create a net gain to taxpayers of almost
$4 billion over the next five years.
ECONOMIC BENEFITS:
· More than $3 billion has been invested in 43 ethanol production facilities
operating in 20 different states across the country.
· The ethanol industry is responsible for more than 40,000 direct and indirect
jobs, creating more than $1.3 billion in increased household income annually,
and more than $12.6 billion over the next five years.
· More than 13,500 Iowa jobs are affected by ethanol, including 2,550 directly
related to ethanol production.
· The ethanol industry directly and indirectly adds more than $6 billion to the
American economy each year.
· As the economic activity created by the ethanol industry ripples through the
economy, it will generate $30 billion in final demand between 1996 and 2000.
· Increases in ethanol production offer potential for economic growth in small
rural communities. USDA has estimated that a 100 million gallon ethanol
plant could create 2,250 local jobs.
· Each gallon of ethanol produced domestically displaces seven gallons of
imported oil.
· Every 100 BTUs of energy used to produce ethanol (including planting,
cultivating, harvesting, and processing) yield 135 BTUs of ethanol. By
comparison, the same 100 BTUs of energy yield 85 BTUs of gasoline or
55 BTUs of methanol.
AGRICULTURAL BENEFITS:
· Industrial corn use, which includes ethanol and sweetener production, is now the
second largest consumer of corn in America.
· Each $1 of up-stream and on-farm economic activity generates $3.20 in
downstream economic stimulus attributable to ethanol processing, compared to
just $0.3l when corn is exported.
· Ethanol production consumed 535 million bushels of corn in 1994 (5.3% of the
record 10 million bushel corn crop).
· The demand for corn created by the ethanol industry increases crop values
-- accounting for approximately $0.14 of the value of every bushel of corn
sold last year, or $1.4 billion.
· If the market for ethanol did not exist, corn stocks would rise and net income
to American corn farmers would be reduced by $6 billion over the next five
years, or about 11%.
· One acre of corn can produce 300 gallons of ethanol -- enough to fuel four
cars for one year with a 10% ethanol blend.
ENERGY/TRADE BENEFITS:
· Domestic ethanol and ETBE production reduces demand for imported oil and MTBE
which drains our economy -- oil and MTBE imports now represent almost 80%
of the U.S. trade deficit.
· Currently, imported oil accounts for 53% of consumption.
· Today, ethanol reduces the demand for gasoline and MTBE imports by 98,000
barrels per day.
· Ethanol production generates exports of feed co-products, such as corn gluten,
further decreasing our balance of trade. Corn gluten exports exceeded $800
million last year, the single largest U.S. export.
· Ethanol production is energy efficient, with a positive energy balance of 125%
compared to 85% for gasoline.
· Ethanol production is the most efficient method of producing liquid
transportation fuels. According to USDA, each BTU used to produce a BTU
of gasoline could be used to produce 8 BTUs of ethanol.
ENVIRONMENTAL BENEFITS:
· Ethanol blends reduce carbon monoxide better than any reformulated gasoline
blend - more than 25%.
· Ethanol is low in reactivity and high in oxygen content, making it an effective
tool in reducing ozone pollution.
· Ethanol is a safe replacement for toxic octane enhancers in gasoline such
as benzene, toluene, and zylene.
· Because it is produced from renewable agricultural feedstocks, ethanol reduces
greenhouse gas emissions.
(The facts above are reprinted with permission from the American Coalition for
Ethanol)
IOWA FACTS:
· Ethanol demand boosts Iowa's state and local tax receipts by $111 million -- the
biggest increase of the top 10 corn-growing states.
· Iowa has the processing capacity to manufacture 425 million gallons of ethanol.
· In 1997, 580 million gallons of ethanol blended fuel were sold in Iowa.
· More than 40 percent of all gasoline sold in Iowa is a 10% ethanol blend.
· Since ethanol's inception in 1978, more than 1.5 billion bushels of Iowa corn have
been processed into ethanol.
· The ethanol processed in 1997 in Iowa would fill 14,000 rail cars.
· Approximately 170 million bushels of Iowa corn are processed annually into
ethanol. |
