U.S. Program Plans to Increase Use of E-85 Fuel

WASHINGTON -- The federal government will give financial help to gas stations that install more pumps for the ethanol fuel E-85 in order to increase production and use of the blend, said U.S. Agriculture Secretary Tom Vilsack. A formal announcement is planned for today. E-85 is a blend of 85 percent ethanol and 15 percent gasoline. Current ethanol blends contain only 10 percent ethanol.

Vilsack stated that the government will offer financial assistance to gas stations owners who install E-85 pumps in the form of grants and guaranteed loans. The funds will come from the Rural Energy for America Program. Vilsack added that President Barack Obama wants the U.S. Department of Agriculture to help make 10,000 flexible fuel pumps available across the country over the next five years. Currently, the eight million flexible fuel vehicles driven in the U.S. can fill up with E-85 at 2,300 stations nationwide.

"The president was pretty clear that he wants to reduce our nation's net dependence on foreign oil by one-third by 2025," said Vilsack. "One way to do that is to increase production and increase use of renewable biofuels."

The program is intended to boost the country's efforts to reach its goal of producing 36 billion gallons of biofuels by 2022; currently, the U.S. produces 13 billion gallons, said Vilsack.

Vilsack added that while he believes the country has enough production capacity to meet the expected demand expansion, "the more demand we create the more opportunity there will be for those who make the pumps," with "the side benefit, I believe, for additional job growth." The president has instructed the USDA to finance four biorefineries to produce biofuels from a variety of sources, possibly including agricultural waste, switch grass and animal waste as well as corn, according to Vilsack.

"We want to spread this industry to all four corners of the country and not just have it focused in the Midwest," said Vilsack.

The announcement came after the Alliance of Automobile Manufacturers testified before Senate Energy and Natural Resources Committee that it is willing to work with the ethanol industry to increase use of ethanol.