The House Committee on Energy and Commerce reached an initial agreement on a proposal to promote sales of new automobiles in the U.S. market. The program is designed to increase auto sales and at the same time enhance the fuel efficiency and environmental performance of the U.S. auto fleet.
This EPRINC report evaluates the consequences to the U.S. transportation fuel sector of increasing the volume of ethanol in the U.S. gasoline pool above current volumes – now approaching 10 percent of the fuel supply. Additional volumetric increases in ethanol use are mandated by federal law. As federal mandates take the U.S. gasoline pool above 10 percent ethanol blend, and ultimately to higher levels through E-85, the value of additional ethanol supplies is likely to decline dramatically. This cost can only be recovered through higher prices for E-10 and distillate, and depending on a wide range of factors, the mandated volumes could easily drive gasoline and distillate prices up by 10-25 cents/gallon over the next 2-3 years as compared to a scenario without the fuel mandates.