Time for some Env-Econ insight. And snark. Mostly snark. Little insight.
The Environmental Protection Agency has approved blending higher concentrations of ethanol into gasoline for newer vehicles, allowing the corn-based fuel to be up to 15 percent of mixtures sold at the pump.
Hmmmm. I wonder if this has anything to do with EPA's ethanol mandates?
The current maximum blend is 10 percent. The EPA announced Wednesday that the higher blend will be approved for cars and light duty trucks manufactured since 2007, if retailers want to sell it.
...and IF consumers want to buy it. Call me unAmerican, but facing a choice between E0 and E15 for refueling my mostly American built car engine, guess what I'm picking? And I'm pretty sure I'm not alone. Too much uncertainty.
"Thorough testing has now shown that E15 does not harm emissions control equipment in newer cars and light trucks," EPA Administrator Lisa Jackson said in a statement. "Wherever sound science and the law support steps to allow more homegrown fuels in America's vehicles, this administration takes those steps."
Mandated production of corn-based ethanol leads to inefficient increases in demand for corn.
The move, which comes less than a month before November's midterm elections, is politically popular in rural farm areas.
Shock headline: Increased demand for corn is popular among corn farmers.
But ethanol faces strong opposition from the auto industry,
Because potentially higher fuel prices, and potentially higher maintenance costs lead to decreased demand for cars.
By at least one measure I'm aware of, EcoIndicator 99, E10's potential environmental damages over the production and consumption are an order of magnitude higher than the damages from 100% gasoline. E15's damages are, well, higher.
Increased demand for corn for other purposes increases cattle feed prices which decreases the supply of beef and dairy which increases the price of beef and dairy which decreases the quantity demanded for beef and dairy which results in a decrease in profits to cattle ranchers. See? Economics is easy.
See cattle ranchers.
and a broad coalition of other groups.
Including snarky environmental economists.