The Senate on Tuesday overwhelmingly approved an energy bill that, among its provisions, would provide up to a $30,000 tax credit for the construction of E85 ethanol refueling stations and $40 million for research into combined electric and E85 flexible fuel vehicles.
However, that provision is not in the House version and is one of several differences that must be reconciled in conference.
Interest in E85 fuel—a blend of 85 percent ethanol and 15 percent gasoline—has been growing in recent months due to frequent spikes in gasoline prices, according to an Associated Press report.
Promoters say E85 is not only cheaper, it reduces America’s dependence on foreign oil and burns cleaner. It’s a boost to the Midwest farm economy because ethanol is distilled mainly from corn.
While regular gasoline prices have been rising, ethanol prices have stayed down because of a rapidly growing ethanol supply and federal tax subsidies. An E85 refueling station in Minneapolis showed $2.07 per gallon for unleaded compared with $1.62 for E85, according to the AP report. Mileage is somewhat lower with E85 depending on the vehicle.
About 400 retail filling stations offer E85 nationwide, most located in the Midwest. More than 4 million flexible-fuel vehicles – which can run on any blend of gasoline and up to 85 percent ethanol – are on the road in the United States, according to government figures, but most of them rarely use E85.
General Motors Corp., Ford Motor Co., DaimlerChrysler, Nissan Motor Co., Isuzu Motors Ltd. and Mazda Motor Corp. make flexible-fuel versions for certain models, sometimes only for sale as fleet vehicles. The differences under the hood are relatively few, so prices are similar to vehicles with comparable standard engines.