E85 Retail Business Case: When and Why to Sell E85

Johnson, Claire; Melendez, M.

doi:10.2172/920927

Cited by 12 publications

(17 citation statements)

References 3 publications

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“…The Department of Energy estimates the cost of equipping a station to carry E85 at $50,000-$70,000 if the station must install a new underground tank, and at $5,000-$30,000 if the station can convert existing tank and must only retrofit or replace dispensers. The National Renewable Energy Laboratory of the DOE distributes a publication entitled "E85 Retail Business Case: When and Why to Sell E85," which lays out a cash flow analysis of an investment in E85 pump installation (Johnson and Melendez, 2007).…”

mentioning

confidence: 99%

Building out alternative fuel retail infrastructure: Government fleet spillovers in E85

Corts

2010

Journal of Environmental Economics and Management

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One significant obstacle to meeting aggressive federal and state alternative fuel consumption targets is the relative scarcity of retail fueling stations that carry alternative fuels. Policies that encourage or mandate use of alternative fuel vehicles in government fleets, thereby increasing demand for such fuels, are one popular approach to stimulating further development of the alternative fuel retail infrastructure. I focus specifically on flex-fuel vehicles (FFVs) that burn E85, a combination of 85% ethanol and 15% gasoline, to study the impact of government fleet composition on retail alternative fuel infrastructure. Using data from six states in the Midwest that account for over 60% of US E85 stations, I show that government fleet adoption of FFVs leads to an increase in retail E85 stations. This finding persists when using instrumental variables techniques to address the endogeneity of government fleet FFV purchases. I also explore whether fuel station retail market structure has an effect on alternative fuel availability and find no evidence that the presence of stations affiliated with integrated gasoline producers has limited the availability of E85 at the market level. Finally, I examine how the effect of government FFVs on E85 availability varies by state and discuss the differing policy approaches that these states have taken. * 105 St. George St., Toronto, ON M5S 3E6. kenneth.corts@rotman.utoronto.ca. Trevor Tombe provided excellent research assistance. I thank

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confidence: 99%

Building out alternative fuel retail infrastructure: Government fleet spillovers in E85

Corts

2010

Journal of Environmental Economics and Management

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“…These station owners may not have knowledge of grants and other incentives available for the installation of E85 infrastructure. Retail station owners are probably uncertain of the investment, especially since the average profit per station is $36,000 and costs for E85 infrastructure average $11,000 for converting a tank and $59,000 for installing a new tank and these costs could be even higher, as indicated by a recent EPA study in support of rule making for RFS [10][11]. Tax incentives are usually recouped over a few years and may not be incentive enough for a station to install E85 dispensing equipment.…”

Section: Discussionmentioning

confidence: 99%

“…The vast majority of underground storage tanks (UST) being used for petroleumbased fuels can also be used for E85 after proper conversion. Analysis has shown that converting a midgrade tank is the most cost effective; however, many types of tanks have been converted including premium, diesel, kerosene, and redundant regular gasoline tanks [10].…”

Section: Fueling Equipmentmentioning

confidence: 99%

“…It is less expensive to convert a station to sell E85 if it already has a usable tank. An NREL 2008 survey of 120 stations found that the median cost to add a new tank was $59,000, compared to a median cost of $11,000 if the owner used an existing tank (Table 4) [10]. Estimates vary widely on the proportion of U.S. stations that have midgrade tanks-between 30% and 60% of stations.…”

Section: Fueling Equipmentmentioning

confidence: 99%

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E85 Dispenser Study

Moriarty¹,

Johnson²,

Sears³

et al. 2009

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Executive SummaryThis study reviews E85 dispensing infrastructure advances and issues and evaluates the geographic concentration of flexible fuel vehicles (FFVs), E85 stations, ethanol production facilities, and E85 suppliers. Costs, space, financial incentives, and barriers to adding E85 fueling equipment at existing stations are also assessed.This study found that E85 is increasingly available in the U.S. in half of the states; however, the other half have minimal or no E85 fueling options. Despite these gains, E85 is only available at 1% of U.S. gasoline stations. Ethanol production reached 9.5 billion gallons in 2008, but less than 1% is consumed as E85. FFVs have not reached a significant concentration in any county, metropolitan area, or state. Summary of Findings• o Costs to convert an existing tank and add E85 dispensing equipment average $11,000 iv

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“…In addition, an NREL report details ownership of gas stations in the United States (Johnson and Melendez 2007). 5 In general, available data for the distribution, dispensing, and end use of ethanol are extremely limited.…”

Section: Dispensing Station Module Inputsmentioning

confidence: 99%

Biomass Scenario Model Documentation: Data and References

Lin¹,

Newes²,

Bush³

et al. 2013

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NOTICEThis report was prepared as an account of work sponsored by an agency of the United States government. Neither the United States government nor any agency thereof, nor any of their employees, makes any warranty, express or implied, or assumes any legal liability or responsibility for the accuracy, completeness, or usefulness of any information, apparatus, product, or process disclosed, or represents that its use would not infringe privately owned rights. Reference herein to any specific commercial product, process, or service by trade name, trademark, manufacturer, or otherwise does not necessarily constitute or imply its endorsement, recommendation, or favoring by the United States government or any agency thereof. The views and opinions of authors expressed herein do not necessarily state or reflect those of the United States government or any agency thereof.

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E85 Retail Business Case: When and Why to Sell E85

Cited by 12 publications

References 3 publications

Building out alternative fuel retail infrastructure: Government fleet spillovers in E85

Building out alternative fuel retail infrastructure: Government fleet spillovers in E85

E85 Dispenser Study

Biomass Scenario Model Documentation: Data and References

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