A Critical Flaw in the Lugar Energy Bill

Sunday, July 10, 2011

A bill has been introduced recently by Senator Dick Lugar, called the 2011 Lugar Practical Energy Plan. You can read a summary of the plan here,. You can see the whole bill here. Contained within the plan is a similar idea as Representative Shimkus' Open Fuel Standard bill in the House. But there is a crucial difference. Robert Zubrin explains:

Senator Dick Lugar
Section 122 of Lugar's bill defines a "fuel choice enabling vehicle" as one that is a member of any one of a number of categories, listed A through G on pages 50-51 of the bill. Among these, category B, is a vehicle capable of using "an advanced alternative fuel blend."

On pages 49-50, an "advanced alternative fuel" is defined as either E85, M70, or other. So as written, the bill would allow its criterion for a "fuel choice enabling vehicle" to be met by vehicles that are ethanol-gasoline flex fuel only, while keeping the vehicle fuel market closed to methanol.

This should not be allowed. While ethanol can make a contribution, only methanol — which can be made cheaply from natural gas, coal, trash, or any kind of biomass without exception — has a sufficiently broad resource base to actually break our dependence upon foreign oil. Not only that, because the resources to make methanol are available almost everywhere around the world, opening the vehicle fuel market to methanol would subject gasoline to competition from methanol everywhere, putting a permanent global constraint on the price of oil. This is essential, because high oil prices are a horribly regressive tax on the entire world economy.

Furthermore, excluding methanol from the vehicle fuel market is an action in restraint of trade, to the benefit of oil and ethanol producers, but very harmful to consumers, as methanol is currently selling, without any subsidy, for about $1.20/gallon (equivalent in energy price terms to gasoline at $2.40/gallon).

In addition, there is no valid reason to leave methanol out. Any flex fuel car that uses ethanol can also use methanol, provided that the seal between the fuel pump and the fuel tank is made of the plastic buna N, (which is invulnerable to methanol), instead of alternative nitrile plastics which decay in contact with methanol. Such a buna N seal can be purchased for less than 50 cents, and replaces an alternative plastic seal costing about the same.

Finally, there currently appears to be a deal brewing in the Senate to eliminate the ethanol subsidy. That being the case, there is a strong case for enacting the Open Fuel Standard as part of the deal. The rational position is: No subsidies for anyone, and no exclusive market for anyone. All fuels should get to compete equally, without the cars being rigged to only accept particular fuels to the exclusion of others.

Every GM and Ford car sold in the USA today carries a flex fuel car computer. They can all become flex fuel vehicles just by loading in the right software. If the right seals are used, they can all be fully flex fuel, capable of running equally well on gasoline, ethanol, or methanol. Any Senate bill needs to be written to insure that outcome.

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