East Central South Dakota | You have to understand the blend wall and how mandates affect it. If we mandate e-15 it will encourage production up to the mandated gallons of usage and as gasoline consumption falls we have excess gallons of ethanol that are " not mandated" and those gallons have hit the "blend wall" and need to find a home.
RBOB gasoline traded today at $2.01 and ethanol traded at $1.38. Close to 50% of the canopies in the nation are independents. At this discount to gas, yes they do have an incentive to blend up to e-15 if allowed to by law. The canopies owned by oil companies will not displace their product with e-15 regardless of the price difference as they have billions of dollars tied up in oil infrastructure. I think the ethanol industry has accepted this.
I will agree with you about the waivers and it would be very nice if the waivers would go away on the mandated e-10. The Rins attached to ethanol and the mechanism to retire them with gasoline production worked well to guarantee the ethanol usage. I have a hard time accepting moving that mandate to e-15, even though it would benefit me personally. Ethanol's discount to gasoline should make the consumer want to use it. At some point we have to start standing on our own legs----based on economics... |
TRUMP Administration What about the Damage done to ETHANOL?!?
