ACE: RFS keeps gas prices down
The American Coalition for Ethanol is reminding consumers with Labor Day travel plans that thanks to the renewable fuel standard (RFS), ethanol is helping stabilize gas prices, particularly during events like the recent severe weather in the Gulf of Mexico.
“Nearly 95 percent of oil production and a million barrels a day of refining capacity in the Gulf Coast was shut down by Hurricane Isaac, and the price impacts are felt in every gallon of gasoline as consumers make travel plans for Labor Day weekend,” said Brian Jennings, ACE executive vice president. “Fortunately, the RFS has helped make alternatives like ethanol available nationwide to limit the pain at the pump caused by this kind of disruption.”
“Even in normal weather conditions, the RFS is the best weapon we have against rising gas prices,” continued Jennings.
He pointed to a study from Louisiana State University that found gasoline prices are reduced by six cents for every billion gallons of ethanol added to the nation’s fuel supply. A recent study by the Center for Agricultural Development also showed ethanol production helped to reduce wholesale gasoline prices by an average of $1.09 per gallon in 2011, saving each U.S. family about $1200 at the pump last year.
“States can’t petition EPA for a waiver from our nation’s 90 percent gasoline mandate, so when hurricanes and fires strain the oil industry—as they do nearly every year—we need to be able to count on a strong domestic ethanol industry to protect consumers from price spikes and gouging,” Jennings said. “While Hurricane Isaac may have triggered the most recent gasoline price spike, an underlying cause of high pump prices is outdated federal policy that has mandated continuing reliance on oil. The RFS is the only tool we have to reduce that reliance by making ethanol, a cost-effective alternative, available for Americans.”
You can learn more about the Renewable Fuel Standard here.