Saturday, June 16, 2007

More Ethanol

And cleaner air, with higher food prices.

Ethanol gets boost as state hikes amount allowed in gas
By Dale Kasler - Bee Staff Writer
Published 12:00 am PDT Saturday, June 16, 2007

In a major boost to the ethanol industry, California regulators will allow oil refiners to nearly double the amount of ethanol they blend into gasoline.

Under guidelines approved Thursday by the California Air Resources Board, refiners will be able to sell gas that's 10 percent ethanol. The rules are designed to help California achieve its goal of reducing greenhouse gas emissions.

Currently, refiners are limited to a 5.7 percent blend, among the lowest in the country, and ethanol makers have been nudging the air board for some time to go to the 10 percent standard. The new guidelines will take effect in January 2010, although refiners could ramp up their ethanol use almost immediately, said air board spokesman Dimitri Stanich.

The new guidelines will significantly increase the demand for ethanol in the nation's largest ethanol market. California already uses about 1 billion gallons of ethanol a year, or roughly one-fifth of all the ethanol consumed in the United States.

The air board's decision comes as some consultants and investment analysts have been warning that the ethanol industry was in danger of overproducing.

As such, the decision was hailed by members of California's ethanol production industry.