Frequently Asked Questions - Ethanol in Gasoline

What is ethanol and how is it used in gasoline?

Ethanol is a gasoline octane enhancer and oxygenate that can be produced domestically from renewable resources. Ethanol is commonly derived from the fermentation of various sugars from carbohydrates found in agricultural crops and cellulosic residues from crops or wood. Ethanol performs as an effective oxygenate, reducing harmful emissions such as benzene.

A percentage of ethanol is generally blended with gasoline when used as motor fuel. The most common blends are:

E10- 10% ethanol and 90 % gasoline

E85- 85% ethanol and 15 % gasoline

Ethanol is available in the Maine market for several different reasons. Those reasons include federal and state regulatory changes, tax incentives, and current fuel market forces.

Why is ethanol suddenly available in Maine?

The introduction of ethanol in gasoline is not a state requirement. Ethanol is available in the Maine gasoline market for several different reasons. Those reasons include the current fuel market and federal and state legislative actions as discussed below:

  • The current fuel market . Maine Public Law 650 provides a state fuel tax incentive of 1 cent per gallon of E-10. A federal tax incentive for refiners and distributors exists for certain gasoline blends of ethanol (in the case of E-10 the blenders credit is 5.1 ¢ per gallon of ethanol) , and has created an industry incentive to use higher volumes of ethanol; however, that being said the market is fluid and could change at any time should blending with ethanol prove to be less cost effective than other fuel formulations;
  • National Renewable Fuels Standard Congress passed in 2005 the Energy Policy Act which mandated an increase in the amount of renewable fuels used in gasoline nationally. In 2006 the national requirement was met by adding ethanol to meet the 2.78 % renewable fuel content mandate, or 4.0 billion gallons. In 2007 the Energy Independence and Security Act was amended to require 9 billion gallons of ethanol to be blended into the gasoline supply in 2008 increasing to 36 billion gallons in 2022. Maine has no renewable fuel standard requirement.
  • Maine MtBE ban - 38 M.R.S.A §585-I, passed by the Maine Legislature in 2004, banned the sale and distribution of gasoline with greater than 0.5% MtBE into Maine after January 1, 2007, effectively banning MtBE as a gasoline additive in the state. The states of New Hampshire , Vermont , and Rhode Island have enacted similar bans. Ethanol has been blended with gasoline in place of MTBE to enhance combustion and octane levels.

How will this change the gasoline supplied in Maine?

The net result of these various requirements is that the amount of ethanol in gasoline distributed in the Northeast has increased due in part to the legislative changes and in part to the fuel market. The market will continue to encourage increased usage of E10 as long as there is an economic benefit to the refiners and fuel distributors to supply E10. We expect that by November 2008 nearly all the gasoline distributed in Maine will be a blended gasoline with 10% ethanol.

What issues are we hearing about?

As a result of the introduction of ethanol-containing gasoline in Maine , the Department has received several questions:

  • Fuel economy decrease. There is about a 3% loss of fuel economy from the use of E10 (gasoline with 10%ethanol) because it contains 3% less BTUs; potentially making it more costly for the consumer to refuel more often.
  • The use of ethanol in vehicles, boats, and other gasoline powered equipment . By far the vast majority of vehicle engines should not encounter any performance related problems. However, certain engine/fuel system components in older (pre 1980) engines may not be compatible with ethanol. For instance, certain types of rubber used in seals and hoses may deteriorate more rapidly when exposed to ethanol blended gasoline. If anyone has questions about their vehicle systems compatibility with ethanol blended gasoline, they should contact their engine manufacturer.

    Boats, motorcycles, snowmobiles, ATVs, lawn and garden equipment, etc. may encounter similar problems. Again if the vehicle engine or fuel system is pre 1980, people should contact the manufacturer for recommendations. Again, if anyone encounters engine or fuel system performance problems they think may be related to ethanol blended gasoline, they should notify the station immediately and seek assistance from a qualified engine technician.
  • Underground gasoline tank retrofits. Ethanol blended gasoline is not compatible with water (the ethanol must be transported and blended into gasoline at the terminal as opposed to MtBE, which was blended at the refinery), and also acts as a solvent to break up and dissolve sludge and scale that may have accumulated in storage tanks over time. In order to avoid problems, before converting to ethanol blends station owners must remove all previously accumulated water, sludge and scale in tanks intended for storage of ethanol blends. If tanks are not appropriately prepared for this conversion, two problems can occur;
    1. Water in the tank can cause ethanol to separate into the water phase, resulting in either water being introduced into the engine fuel system or the octane content of the gas being reduced below engine driving requirements. Both of these conditions may cause poor performance or engine stalling.
    2. Ethanol may re-dissolve scale or sludge in the tank and potentially carry it into the vehicle fuel system, clogging fuel lines and filters.
    3. Ethanol is incompatible with some materials used in the manufacture of underground product piping, both flexible plastic and rigid fiberglass, which can lead to failure of the primary (inner) piping and result in a discharge of petroleum to the environment. While the incompatible piping is no longer manufactured, it was installed at several underground storage tank facilities in Maine.

If consumers notice problems shortly after filling up with ethanol blended fuels, they should notify the station where the fuel was purchased to see if similar problems have been reported, and take the vehicle to a qualified technician immediately. The problem could be as simple as a plugged fuel line or filter, or may require draining bad gasoline out of the fuel system.

What will it cost to convert my storage tanks to receive ethanol- blended fuel?

The Department developed a guidance document for Maine 's aboveground and underground gasoline storage tank owners with basic information on preparing for the introduction of an ethanol-gasoline blended product to their tank systems. The primary areas of concern as mentioned above are product cleanliness, materials compatibility, and water control . Failure to adequately address these three areas of concern could lead to tank system failure and/or customer dissatisfaction.

The costs to tank owners to transition from Maine 's current gasoline to gasoline containing ethanol can vary. However, it is clear that these transition costs will significantly impact the smaller stations resulting in a number of small station shutdowns.

FAME provides low-interest, fixed-rate financing for the removal, disposal and replacement of aboveground and underground commercial storage tanks, piping and related equipment associated with the tank, as well as the purchase and installation of vapor recovery systems. See the link below for more information: www.famemaine.com/business/DirectLoans_OilStorageFacilityAndTank.asp