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E85 Wants Five Year Bridge

E85 Wants Five Year Bridge

Coalition is seeking inclusion of E85 as an alternative fuel in tax code.

The Society of Independent Gasoline Marketers of America has joined the Coalition for E85 in the effort to have 85% ethanol designated as an alternative fuel under the tax code. The recently-launched coalition is made up primarily of fuel retailers who are concerned about the future of E85 once the Volumetric Ethanol Excise Tax Credit, or blender's credit, expires without renewal at the end of the year. Efforts are underway to get a bill introduced in Congress to address the issue before the end of the year.

Tax code specialist Jeff Trinca is working with the coalition. Trinca says that E85 as an alternative fuel is defined everywhere in the U.S. code, except for the Internal Revenue code. It has not been included within the tax code in the past in order to avoid "double dipping" in tax credits because of the existing blender's credit.

"With the expiration of the blenders' tax credit at the end of this year, the coalition would like E85 to be included in the definition of alternative fuels with propane, natural gas and others so there's a level playing field," Trinca said. He noted that the coalition is only looking for a five year bridge to get the infrastructure in place to be competitive with gasoline.

Meanwhile, the U.S. Energy Information Administration reports that ethanol production averaged 917,000 barrels per day, or 38.514 million gallons daily for the week ending Nov. 18. That is up 1,000 barrels per day from the previous week.  The four-week average for ethanol production stood at 915,000 for an annualized rate of 14 billion gallons. Stocks of ethanol stood at 17.5 million barrels.

Gasoline demand for the week averaged 360.9 million gallons daily.  Expressed as a percentage of daily gasoline demand, daily ethanol production was 10.67%.

On the co-products side, ethanol producers were using 13.904 million bushels of corn to produce ethanol and 103,207 metric tons of livestock feed, 93,114 metric tons of which were distillers grains.  The rest is comprised of corn gluten feed and corn gluten meal.  Additionally, ethanol producers were providing 4.22 million pounds of corn oil daily.

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