Ethanol held down price of gas by $1.37 per gallon, says study

Ethanol held down the price of gasoline sold in the Midwest by $1.37 per gallon in 2010 according to a study from the Center for Agricultural and Rural Development.


“The price at the pump is painful, but ethanol lessens the pain and price for a gallon of gasoline. Ethanol, a clean renewable fuel, enters the fuel supply and offsets the demand for fossil fuel gasoline,” according to Brian Kletscher, Chair of the Minnesota Bio-Fuels Association. Citing a report from the Center for Agricultural and Rural Development, Kletscher explains “the increase in ethanol production reduced wholesale gasoline prices and that translates into a larger reduction at the pump, about $0.89 nationwide and $1.37 per gallon in the Midwest in 2010.”

Tim Rudnicki, executive director of the Minnesota Bio-Fuels Association said “Minnesotans spent about $7 billion for gasoline motor fuel in 2010, and 90% of that, or $6.3 billion, is money sent out of state to buy gasoline motor fuel. Contrast this with ethanol made right here in Minnesota. Every gallon of ethanol replaces a gallon of petroleum. That means jobs for Minnesotans, more energy dollars stay in the state, farmers have a chance to earn a decent living and we make ourselves more energy independent. We have a win-win for our workforce, our agricultural community, the environment, and motorists.”

The Minnesota Bio-Fuels Association represents the renewable fuels industry within the State of Minnesota. MBA explores ways to decrease dependence on petroleum while being mindful of the environment, energy security and the benefits of local economic development.

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Our Take:
Blow away the smoke and take down the mirrors put up by Big Oil and the truth about farm-based renewable energy comes through.

Ethanol is a boon to consumers, and the last bulwark against a global energy market that gets more fiercely competitive (read: soaring prices to buy what you want) as the developing world economies like China and India kick into high gear. With a growing component of energy we can source within our own borders, that spot price for oil is checked. And that’s the key to quelling runaway energy prices.

We should add what an incredible service to Minnesota, and especially to the needs of its rural economy, these two organizations provide: Minnesota Bio-fuels Association and Center for Agricultural and Rural Development. The first is an industry group, the second, a legislatively-mandated group–together they offer the best kind of public-private cooperation in pursuit of public policy that is helping Minnesota’s farmers and small towns stay strong.

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