WASHINGTON, April 25, 2006 – The nation’s oil and natural gas industry is committed to using more ethanol in its fuel mix in an efficient and cost-effective fashion which focuses on economics and reliability, not government mandates, API President and CEO Red Cavaney said Tuesday.
In a speech at the Renewable Fuels Summit 2006, Cavaney noted that the oil industry agreed with the ethanol producers, environmental groups, government and other stakeholders to significantly increase the amount of ethanol in the gasoline pool.
“The U.S. oil and natural gas industry recognizes and appreciates ethanol’s role in the national gasoline marketplace, and we have worked closely with the ethanol industry and others to bring us to this point. In our view, ethanol is here to stay as an important part of our nation’s gasoline supply,” Cavaney said.
Mandates are not the way to use ethanol in the most efficient and cost-effective way, Cavaney said. He noted that some ethanol proponents focused on E-85 fuels, which consists of 85 percent ethanol and 15 percent gasoline, even though companies in the transportation fuels business see mandates regarding E-85 use as “highly risk-laden.” More than 97 percent of the cars on the road today cannot use E-85 without risk of damage and the price of ethanol has exceeded gasoline over the past year.
“Given the current market structure for ethanol and gasoline, one can understand why the demand for E-85 is low,” Cavaney said. ”A policy step that mandates the use of a fuel that contains a high percentage of ethanol, such as E-85, could be costly to consumers and potentially damaging to the ethanol industry’s long-term interests.”
Click here for Full Text of Red Cavaney's Speech
News media contact: Karen Matusic, (202) 682-8118
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