Market Opportunities: Mid-Level Blends

With volatile energy costs affecting all Americans, offering flex-fuel vehicle (FFV) owners more choices at the fuel pump makes sense. FFVs are vehicles manufactured to operate on gasoline and up to 85% ethanol (E85), or any mixture of the two, such as mid-level ethanol fuel blends. One way to accomplish this goal is for retail fuel station owners to purchase and install a multi-product fuel dispenser, commonly referred to as a “blender pump.” Blender pumps utilize existing fuels available at the station to offer additional fuel blends directly from the dispenser. New fuel blends such as E20, E30, and E40, offer consumers ethanol blended fuels between 10% and 85% ethanol.

The RFA Market Development team has partnered with the American Coalition for Ethanol, the National Corn Growers Association and 12 state corn grower associations to educate gasoline marketers and retailers about the use of mid-level ethanol blends and blender pumps.  Begun in 2009, the Blend Your Own (BYO) Ethanol Campaign offers a single source of ethanol information and technical expertise for petroleum marketers looking to upgrade equipment or begin offering more choices to their customers. By serving as a central clearinghouse for renewable fuels infrastructure incentives, the BYO Ethanol Campaign will bring blender pumps to key areas of the country, and from there they will spread as neighboring gas stations see the benefit and want to remain competitive.  With certification from Underwriters Laboratories (UL) of several blender pump models, the marketplace now both the technology and the information to install, offer and market mid-level ethanol blends.  More information is available at www.BYOethanol.com.

Introduction of new fuel blends is expected as the marketplace incorporates additional biofuel volumes. Mid-level ethanol blended fuels - fuels containing above 10% and below the 70% minimum ethanol content allowed in E85 fuels - are being developed. These fuel blends are described as “EXX,” where the letter E stands for “ethanol volume percent” and the “XX” indicates the maximum ethanol content contained in the blend, with the balance of the fuel being unleaded gasoline. Today, these mid-level ethanol blends are restricted for use in FFVs.

Becoming a Flex-Fuel Blender

The RFA has prepared a resource guide, “Becoming a Flex-Fuel Blender,” for ethanol producers looking to pursue this new ethanol marketing opportunity. This guide covers the regulatory requirements, including federal and state, fuel quality standards, incentives, and legal considerations.

Fuel Quality

A best practices guide is available to fuel blenders across the U.S. looking to incorporate mid-level ethanol blends into their product offering. Recognizing that fuel quality is a vital aspect of motor fuels, the RFA has developed the “Guidelines and Best Practices for Blending Mid-level Ethanol Blends” in order to provide the marketplace with the support needed to ensure the content and make-up of these fuel blends provides consumers the quality fuel they demand.

To ensure the fuel that is being offered is truly what is being dispensed, the RFA has developed the “Blender Pump Sampling and Testing Procedure”.  This document recommends certain ASTM sampling methods that should be used in addition to a step-by-step sampling procedure.

Flex-Fuel Vehicles

The idea of using ethanol as a transportation fuel dates back to the 1880’s with Henry Ford designing his automobiles to run on ethanol. The first flex-fuel vehicle available was the 1908 Model T, a far cry from the sophistication of today’s automotive technology. Several vehicle manufacturers currently make flex-fuel vehicles (FFVs) or variable fuel vehicles (VFV) that are capable of operating on 100% gasoline, E85 or any mixture of the two, such as mid-level ethanol fuel blends. Mid-level ethanol blends are a newly offered fuel for use in FFVs, developed to complement E85 fuel sales.

In 2011, there are nearly nine million FFVs on the roadways representing about 3% of the total light duty vehicle fleet.  Domestic automobile manufacturers have committed to produce 50% of their current models with the flex-fuel option by 2012.

There are several ways to determine if a vehicle is a FFV:

  • The inside of a vehicle’s fuel door will typically note E85 compatibility with a sticker.
  • Since September of 2006, auto manufacturers are required to place a label inside the fuel door and to badge the rear of the vehicle. Some manufacturers actually added yellow gas caps for additional recognition.
  • Flex-fuel capability is noted in the owner’s manual and encoded in the vehicle’s identification number (VIN).

FFVs are growing in demand as consumers want a choice in fuels and desire to support domestically grown transportation fuels. For more information on FFVs and E85, including a station locator, click here.