Advantages and Disadvantages

of Using Ethanol:
The Consumer Viewpoint
Ngo Anh-Thu
Graduate student
and
Gale West
Professor, Director of Consumer
Science Programs
AIEA2 International Conference
and WORKSHOP of the CAES
Laval University
Québec, Québec, August 24, 2004
 On today’s menu…..

Introduction
Brief review of consumer perceptions
Disadvantages of using ethanol
Advantages of producing & using
ethanol
Conclusions & strategic implications
 Why ethanol in Canada?

The Kyoto Protocol commitment:

- by 2012, Canada has to return to 94% of its
1990 GHG emission level.

Canadian greenhouse emissions:

- 73% from fossil fuel combustion;
- 25% from on-the-road transportation.
Consumer perceptions today

In Canada
- 86% of the population is concerned by the level
of foreign oil imports & wants to reduce this
dependence to foster national security;
- 80% of the population is aware of climate
change;
- 78% of Ontarians agree to buy ethanol blend IF
the price of the ethanol blend equals that of
gasoline.
- 72% of Ontarians support a mandate to blend
ethanol into gasoline;
 But what are the alternatives?

 Future energy choices of U.S. consumers

Best fuel for future Worst fuel for future
- Electricity 52% 15%
- Ethanol 21% 28%
- Hydrogen 15% 27%

 Future choices for reducing oil imports

- Making energy efficient vehicles 48%
- Tax rebates for higher efficiency vehicles 24%
- Higher taxes on less efficient vehicles 11%
 Practical consumers are

 Not that altruistic!

 They are mostly concerned with:
- Traffic congestion (34%)
- Availability and/or price of gasoline (28%)
- Global warming (14%)
- Local air pollution (12%)
 However, climate change and air pollution are
important to some consumers.
Disadvantages of ethanol
 Negative environmental and
health impacts of ethanol

 Aldehyde, a function of ethanol volume, is a threat

to nose, eyes, throat & possibly causes cancer.
 At volumes below 23% ethanol, aldehyde
emissions can be well controlled by the catalytic
converter:
Gasoline Gasohol Ethanol
Aldehyde (0% ethanol) (22% ethanol) (100%)
Before converter 100% 120% 450%
After converter 100% 100% 120%
 Negative cost considerations to
consumers
(Fuel Economy Guide 2004, U.S. Department of Energy)

 E85 costs 33% more to consumer’s annual budget:

Fuel use Annual fuel cost

Chrysler E85 $1323 U.S.
(Sebring convertible) gasoline $ 900 U.S.
Dodge (~ Mercury) E85 $1323 U.S.
(Stratus 4 door) gasoline $ 876 U.S.
GMC Sports Car E85 $1874 U.S.
(1500 Yukon 2 WD) gasoline $1312 U.S.
 Negative cost considerations
(Canada)

 In Quebec, E5 is available at certain service

stations.
Regular gasoline E5 (5% ethanol blend)
88.3 ¢/litre 91.3 ¢/litre

 In Canada, since the cost of making ethanol is

still high, ethanol prices at the pump are a
function of % ethanol in the blend.
 Negative technical dimensions

 Driving ability of ethanol is lower.

- Lower per litre energy value (EV);
- Takes more to drive the same distance;
- Consumers have to fill their cars more often;
- And they have to pay more for ethanol fuel.
 When blended above E10, consumers :
- Driving regular cars have to pay at least $1,200
U.S. to have their engines adapted; and
- Have to drive extra distances to special service
stations to buy ethanol.
 Negative technical dimensions
(cont.)
 Ethanol can absorb water & if water enters the fuel tank
- It dilutes ethanol, reducing its value as a fuel;
- It causes problems with corrosion and phase separation
in the gasoline mixture.
 Ethanol dissolves almost everything.
- It absorbs and carries dirt inside the fuel lines and fuel
tank, thus contaminanting the car engine system.
 Ethanol is rich in octane content.
- It is highly flammable and explosive compared to
gasoline.
- It requires more attention to handle in daily life.
Advantages of ethanol
 Postive environmental impacts:
Life cycle analysis
(National Renewable Energy Laboratory, U.S. Department of Energy)

Agri- product
transport
 Positive health and political
impacts
 Health impacts
Replaces bad gasoline additives (MTBE and lead),
which are sources of surface and ground water
contamination, and dangerous to human health;
 Political impacts to consumer-voters
- It potentially replaces crude oil, which is a finite,
non-renewable resource;
- It can be domestically produced, thus reducing
dependence on oil imports;
- It can potentially cut oil import costs.
 Positive socio-economic impacts
 Ethanol uses agri-products as a feed-stock;
 It is a renewable source of energy, which can
replace fossil fuel in the future;
 It increases value added and price of agri-
products,
 which increases net farm income;
 It creates more jobs in the rural sector;
 Strengthens rural economies;
 It can potentially reduce government subsidies to
the farm sector.
 Positive impacts on greenhouse gases

 In Canada today, compared to gasoline,

- E10 can reduce GHG by up to 3.9%;
- E85 can reduce GHG emissions by 37.1%;

 If ethanol production can be expanded to 1

billion litres per year by 2010,
- E10 can reduce GHG by up to 4.6%.
- E85 can reduce GHG emissions by 44.5%;

 With respect to the Canadian Kyoto

commitment
- These figures represent approximately 0.8 - 1.0%
of the total reduction required.
Positive impacts on exhaust emissions

 How ?
- Ethanol, richer in octane, promotes more complete
combustion of gasoline thus reducing exhaust
emissions.
 Without catalytic converter, compared to gasoline:
- Using E6 lowers CO emissions by 27%; and
- Also lowers other harmful emissions (ex., HC, PM,
VOC & SOx).

 However, with the catalytic converter :

- Almost no difference in exhaust emissions between
gasoline and ethanol blends.
 Positive technical dimensions

 High octane content gives particular value to

consumers using high performance engines.
 When used as a gasoline additive, ethanol is
- not as poisonous as MTBE and lead,
- a soluble deposit-controler, removing
impurities in the fuel system and placing them
in the filter;
- an anti-icer, preventing fuel-line freeze up in
the winter, and requiring less time (and
energy) to start the vehicle;
- richer in octane, an anti-oxidant to reduce
gum formation in stored petrol.
 Conclusions
and strategic implications

 Given increasing consumer interest, there is

a definite need to inform consumers of the
advantages of ethanol.
 Changing consumer choice to ethanol can:
– reduce dependence on foreign oil;
– reduce local pollution and clean the
atmosphere;
– help respect Kyoto GHG commitments;
– slow climate change;
– provide a more renewable fuel source.
 Conclusions
and strategic implications (cont.)

To overcome disadvantages (higher price,

lower driving ability), the Canadian
government should in the short run :

– Provide price subsidies and/or consumer

tax credits (as in Brazil, US, EU, China);

– Limit ethanol blends to E10 or less, to

avoid massive engine reconstruction.
 Conclusions
and strategic implications (cont.)

In the long run, the government should

– promote technical research in ethanol
production;
– instate an education campaign to inform
consumers of the purpose and benefits of
ethanol.
The automobile industry will react to growing
future demand for ethanol by producing new
car engines.
Merci beaucoup
de votre attention!!
 Technical definitions

 In vehicles, ethanol can be used as:

- a gasoline additive (blended into gasoline at
10% or less);
- gasohol (blended at high volume of 20% to
85%); or
- a high blend ethanol (blended at 85% up to
100% pure ethanol).
 Technical limit :
Regular cars can handle up to 10% ethanol
without engine reconstruction.
 Cost considerations to consumers
(Fuel Economy Guide 2004, U.S. Department of Energy)

 E85 costs 33% more to consumer’s annual budget:

Fuel use Annual fuel cost

Chrysler E85 $1323 U.S.
(Sebring converible) gasoline $ 900 U.S.
Dodge (~ Mercury) E85 $1323 U.S.
(Stratus 4 door) gasoline $ 876 U.S.
GMC Sports Car E85 $1874 U.S.
(1500 Yukon 2 WD) gasoline $1312 U.S.
Chevrolet Sports Car E85 $1874 U.S.
(C1500 Silverado 2WD) gasoline $1401 U.S.