Karen Matusic | 202.682.8118 | matusick@api.org
ST. LOUIS, Missouri, October 11, 2006 – Ethanol and other renewable fuels will play an important role in meeting the nation’s energy challenges in the 21st century, API President and CEO Red Cavaney said. He added that the U.S. oil and natural gas industry, as the biggest user of ethanol, is hard at work boosting the ethanol content in the gasoline pool.
Cavaney told the Advancing Renewable Energy Conference that nearly half of the gasoline consumed in the U.S. includes ethanol and some 4.6 billion gallons of ethanol will be used in 2006 – exceeding the 4 billion gallons required by the Renewable Fuels Standard (RFS).
“In our view, ethanol is here to stay, and it is a very important part of our nation’s gasoline pool,” Cavaney said. “It is absolutely essential that ethanol and the entire biofuels industry become strong, vital and self-sufficient.”
Cavaney noted that the oil and natural gas industry has nearly 100 years of experience and has developed the infrastructure vital to reliably supply U.S. consumers with the fuel they need. A reliable fuels “partner” is essential to the future success of both the oil and biofuels industries, he said, stressing that the consumers’ early experience with biofuels needs to be a positive one.
“We do not want to be a party to any ‘over-promise and under-perform’ commitment,” Cavaney said. “All of us have to be realistic in our expectations and pronouncements about the relative merits of various alternative energy sources.”
Cavaney said the industry was concerned that some ethanol proponents are focused exclusively on E-85, a fuel containing 85 percent ethanol, as the way to boost ethanol use. He pointed out that the price of ethanol has exceeded that of regular gasoline on a volume basis for 28 of the past 33 months and significantly exceeded the price of gasoline on an energy-content basis. Ethanol has about 70 percent of the energy per unit of volume as gasoline.
“We believe allowing market forces and consumer preferences to determine where and how ethanol is consumed is the most effective and least costly way to integrate ethanol into the nation’s transportation fuels pool,” he said.
Cavaney was one of the featured speakers on the first day of the conference, sponsored by the U.S. Department of Agriculture and Department of Energy. President George W. Bush is scheduled to deliver the keynote address on Thursday.
API is the national trade association of the U.S. oil and natural gas industry.
Cavaney's complete remarks are available here.