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Plan For Higher Ethanol Blend Gas During Summer To Save Drivers a Few Cents Per Gallon

SAN FRANCISCO (CBS SF) -- The Biden administration is taking another step to lower gasoline prices as the Environmental Protection Agency will suspend the normal summertime ban on gas made with more ethanol.

"California blends 10% of its gasoline as ethanol," explained UC Berkeley economist Severin Borenstein. "That is the standard nationally. This would allow blending up to 15% ethanol in our gasoline."

Great news for farm states, and people who grow corn, but for drivers, the 5% uptick of ethanol will not add up to much. California gas prices, which include state taxes and production rules unrelated to ethanol, will not change greatly.

"Even in California it won't make much difference," said Borenstein. "So the effect on gasoline prices will be a few pennies at most."

"Half-full now," said Brian Boyd while filling up in Martinez Tuesday. "I'll see what happens when I fill up half this tank."

Those few pennies may be in the eye of the beholder. Boyd isn't scoffing at savings of 10 cents a gallon.

"Means a lot," Boyd said. "Especially with the 36-gallon fuel tank I have."

There are environmental trade-offs, and E15 may not be suited for some cars made before 2001. Factor in efficiency and the savings are small.

"It is cheaper on a volume basis, but ethanol has less energy," Borenstein said. "So actually you get fewer miles per gallon just for that, it's a little bit cheaper than gasoline, but not a huge amount cheaper than gasoline. So it's not gonna drive down our prices very much."

One open question is how many refineries actually produce gas with the added ethanol. It is not a mandate and participation will drive the impact for drivers.


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