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Ethanol still a long way off in U.S.

A shortage of stations is keeping the corn-based fuel from catching on. Production issues could take years to address.

March 10, 2007|John O'Dell, Peter Pae and Ronald D. White | Times Staff Writers

SAN DIEGO — The ethanol pumps weren't very busy Friday at California's only public alternative fuel depot as President Bush and Brazilian President Luiz Inacio Lula da Silva promoted a pact to increase the production of ethanol and other fuels made from plants.

During an otherwise busy three-hour stretch Friday afternoon, only one driver pulled into Pearson Fuel to pump a blend of 85% ethanol and 15% gasoline. Co-owner Mike Lewis said ethanol accounted for less than 5% of the fuel he peddles, while gasoline outsells all the other fuels combined -- ethanol, oil and plant-based diesels, natural gas and propane.

"People love to be green," Lewis said, referring to alternative fuels' environmentally friendly status. "But they like green in their wallets more."

Unless ethanol is at least 50 cents a gallon cheaper than gasoline, "people don't buy it," he said.

Pearson Fuel, with its alternative-fuels education program for schools and its six fuels for internal combustion engines, may be the fuel station of the future. But it's a distant future.

For The Record
Los Angeles Times Wednesday March 14, 2007 Home Edition Main News Part A Page 2 National Desk 0 inches; 33 words Type of Material: Correction
Ethanol: An article in Section A on Saturday about the state of the U.S. ethanol industry said corn growers received a federal tax credit. The credit is granted to certain small ethanol producers.

Bush wants Americans to produce and use ethanol, a fuel made from the alcohols refined from plant material, to help reduce the nation's dependence on fossil fuels, particularly those imported from abroad.

The goal of Friday's agreement with Brazil is to make ethanol an international commodity through technology sharing and other cooperative ventures.

However, experts say the accord between the two countries, which already produce 70% of the world's ethanol, would do little to boost production or use of biofuels by the end of the decade beyond the levels already anticipated.

In his State of the Union address in January, Bush called for annual national production of 35 billion gallons of ethanol by 2017, up from 5 billion gallons in 2006. But more than an international acknowledgment that biofuels are desirable, the U.S. needs development of better ways to make it and an efficient way to transport and deliver it to retail customers, experts said.

Although Bush and others regularly point to Brazil as an example of what a determined nation can do to reduce its dependence on oil -- most motor vehicles in Brazil run on a blend of 80% ethanol and 20% gasoline -- there are huge differences. Brazil has been subsidizing its ethanol industry for several decades, and has a huge crop -- sugar cane -- that can efficiently be refined into ethanol.

In the U.S., ethanol development has only just begun and it is now based entirely on product derived from corn. And squeezing the ethanol from corn kernels requires more processing, and more expense, than refining it from most other plant materials.

To protect the nascent industry, the U.S. government imposes a 54-cent-a-gallon tariff on ethanol imported from Brazil. The U.S. also grants tax credits to American corn growers and a subsidy of 51 cents a gallon to companies that make gasoline-ethanol blends.

To achieve Brazil's results, the U.S. would have to turn all of its crop-producing acreage over to corn and use all of the corn for ethanol, said Eric Wittenauer, a St. Louis-based energy analyst at A.G. Edwards & Sons Inc.

"We would also have to double the fuel efficiency of our cars and trucks," said David Friedman, vehicle research director and fuel efficiency specialist for the Washington-based Union of Concerned Scientists.

That's not likely to happen.

In fact, while corn growers lobby intensively to keep their crop at the top of the biofuel heap, tremendous research efforts are underway to develop cost-effective methods of distilling ethanol from other types of plant material, said Sharon Shoemaker, executive director of the California Institute of Food and Agricultural Research at UC Davis.

That alternative type of ethanol could go a long way toward helping Bush achieve his goal of a 20% reduction in gasoline consumption over the next decade through increased use of ethanol and other biofuels.

"Very rapidly the doors are opening," Shoemaker said.

Automakers are climbing onto the bandwagon, some more quickly than others, with General Motors Corp., Ford Motor Co. and Chrysler Group pledging to make at least half their vehicles ethanol burners by 2010. There are 32 models available today, most of them large pickups and sport utility vehicles.

But it's at the pump where ethanol backers face several challenges.

Of the more than 165,000 gas stations in the country, only about 1,000 offer E85 ethanol, the name for the 85% ethanol blend, and most of them are clustered in the corn-producing Midwest.

In California, which has more cars and trucks on the road than any other state, there are four ethanol stations, and Pearson Fuel is the only one open to the public.

Many of those flex-fuel GMs and Fords being sold these days, like Katherine Gagnon's late-model Ford Explorer, are a lot more familiar with gasoline than with the stuff the president hopes will start replacing it.

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