Report: Transitioning to a High-Octane Fuel Market Is Feasible, But There Are Hurdles

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Report: Transitioning to a High-Octane Fuel Market Is Feasible, But There Are Hurdles

04/01/2019
Pumping gas into a car

ALEXANDRIA, Va. — While fuel efficiency becomes a focus in the United States, fuel industry insiders have offered a high-octane standard for the gasoline market as a fast and cost-effective solution.

However, as a pair of reports by the Fuels Institute point out, potential changes to the market could have significant implications for fuel retailers — from equipment upgrade requirements to consumer reaction.

"The science clearly demonstrates that when higher octane gasoline is used in engines designed for it, those engines can deliver greater fuel efficiency and lower emissions," said John Eichberger, executive director of the Fuels Institute.

"The Fuels Institute board of advisors wanted to better understand how such a fuel might be produced, what modifications to the distribution system might be required to deliver it to consumers, what regulations might need to be modified to facilitate a transition, how long a transition might take and what the fuel might cost consumers. These new reports go a long way to help answering such questions," he added.

The reports, "Transitioning the U.S. Gasoline Pool to a Single High-Octane Fuel: A Baseline Analysis" and its companion white paper, "Analysis of the Potential for Increasing Octane in the U.S. Fuel Supply," provide objective analyses of the capability of the fuels market to deliver higher octane gasoline to consumers, as well as the regulatory and market dynamics that such a transition would affect, according to the Fuels Institute.

Eichberger noted that the research team found that a high-octane market is possible, but would likely require a federal mandate to be successful.

The baseline report modeled high-octane fuels containing various levels of ethanol and found that ethanol could reduce production costs. However, this would simultaneously introduce compatibility issues within the distribution system that would require substantial investments to address.

In addition, if the fuel is not similar to an existing fuel, the regulatory and transition process could take 20 years or more, the report concluded.

The companion white paper, prepared at the direction of the board of advisors, presented the report's analysis within the context of other octane-related research, the evolving market and regulatory discussions that occurred during 2018.

It combines the findings of the commissioned report with the findings of the Department of Energy's Co-Optimization of Fuels and Engines Initiative, additional analysis released by the United States Council for Automotive Research LLC and various consumer and market data analyses prepared by NACS, the Association for Convenience & Fuel Retailing, to provide a high-level overview of the issue, Eichberger explained.

"These new publications show that transitioning to a high-octane market is feasible, but there are hurdles that must be acknowledged and accommodated. The white paper specifically makes it clear that consumer education prior to initiating the transition is critical because consumers are very sensitive to fuel prices and don't understand what octane is," he said.

For the Fuels Institutes reports, click here.

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