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Last month, the Environmental Protection Agency (EPA) announced that its decision to raise the ethanol blend from ten percent (E10) to 15 percent (E15) had been postponed pending further testing. Prior to announcing the postponement, the EPA received reports from automakers suggesting that E15 could be detrimental to modern engines. Rather than act in haste, the EPA determined that in-depth testing of current vehicles could more accurately determine the effects of running E15. While the EPA's re

Refiners and blenders pocket 45 cents for every gallon of ethanol blended with gasoline. The subsidy, courtesy of the U.S. government, helps the industry stay afloat amidst the dwindling demand for gasoline and increasing costs of ethanol production. It's been argued that, without the subsidy, the ethanol industry would die a quick death. If a report from BusinessWeek turns out to be true, then the industry might soon be dealt a glancing blow.

Ethanol has been blended with gasoline for years now in a fuel typically called E10 (which is made with 10 percent ethanol). E15 could soon become the new norm if, as industry experts predict, the U.S. reaches the "blend wall" and changes come soon.

Photo by Eric Charlton. Licensed under Creative Commons license 2.0.

Photo by Hummanna. Licensed under Creative Commons license 2.0.

While we spent a lot of late 2007 talking about the very real ethanol glut that was happening in America, the good news for people who have a lot invested in the biofuel (farmers, for one) is that prices have been on the upswing since mid-November. According to an article in the Wichita Eagle, the rebound is taking the form of a 35-cent-per gallon increase and is "within 10 cents of the wholesale price of unleaded gasoline." There is still plenty of ethanol available, but with fewer plants being

Citibank says that the current low ethanol prices are going to last another six months or so. Until prices do go up, according an article by Robert Pore in the Grand Island Independent, the price of gas at the pump should remain somewhat low, thanks to that 10 percent ethanol blend in most of the gasoline supply in the U.S. Pore spoke with Steven Sorum of the Nebraska Ethanol Board, who said that the current excess ethanol production is what's driving prices down.

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