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Future Fuels: The Coming Revolution in American Vehicle Transportation
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Future Fuels: The Coming Revolution in American Vehicle Transportation

Arthur Herman

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Executive Summary:

America is poised for a major transformation of its vehicle transportation system, based on a progressive shift from petroleum gasoline to other alternative fuels, including ethanol and methanol.

Not only are the technologies to lead such a shift already commercially available, but 17 million flex fuel vehicles are ready to take full advantage of the shift away from petroleum gasoline—while minor technical adjustments will allow millions of conventional automobiles to burn cleaner, increasingly cheaper alternatives such as ethanol and methanol, as well as E85 and other fuel blends.

Americans already use alternative fuels thanks to the ubiquitous presence of E10 (10% ethanol, 90% gasoline) at gas pumps around the country. Fears that increasing the percent of ethanol in higher fuel blends will damage automobile engines, are not borne out by the facts—while increasing that percent will lead to higher octane performance and cleaner tailpipe emissions.

In addition, through greater reliance on alternative fuels like ethanol and methanol, auto makers will be better poised to meet the future Corporate Average Fuel Economy standard, or CAFE, which is set to rise to 54.5 miles per gallon by 2025. The higher octane rates of methanol and ethanol will allow carmakers to build smaller, more efficient engines, which will also lead to lower carbon emission rates—something that will please environmental regulators.

Today, most of the ethanol used in E10 and other blends comes from corn. Many of the worries concerning corn ethanol are exaggerated (of the U.S.’s 280 million acres of cultivated farmland, for example, only 88 million produce corn—and of that barely one-fifth is used to produce corn ethanol). However, a far more promising feedback for ethanol and methanol fuel production exists with America’s new abundant supplies of natural gas (NG).

The shale natural gas revolution is bringing real energy security to America, making the U.S. the world’s biggest NG producer, with total reserves exceeding 350 trillion cubic feet, making it the fifth largest in the world. It can also serve as the springboard for a transportation revolution, supplying gas for compressed natural gas vehicles (more than 12 million are on the road worldwide) and for inexpensive conversion to methanol and ethanol.

Natural gas-derived ethanol and methanol will be fuels that are American-made, creating American jobs and American transportation independence, in ways no boycott or production cuts by the Organization of Petroleum Exporting Countries (OPEC) can ever threaten again. Brazil, China, and Europe are already making the change-over to ethanol and methanol as principal transportation fuels. Thanks to abundant natural gas, the outlook for the United States looks even more promising—as well as technically and commercially feasible.

The papers published here are selected from the talks given during a conference held at the Hudson Institute on May 7, 2015, entitled “Fueling American Growth: How Energy Independence Will Power Our Transportation Future.”

Participants included:

John Hofmeister, Former President, Shell Oil Company, Keynote Speaker

Reuben Sarkar, Deputy Assistant Secretary for Transportation, Department of Energy

Coleman Jones, Biofuels Implementation Manager, General Motors

Brian West, Deputy Director, Fuels, Engines, and Emissions Research Center, Oak Ridge National Labs

Scott Segal, Head of Policy Resolution Group, Bracewell and Giuliani, LLP

John Eichberger, Vice President, Government Relations, National Association of Convenience Store Owners

Greg Dolan, CEO, Methanol Institute

Michael Jackson, Director of Research, Fuel Freedom Foundation

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