Renewable Fuels Standard Saves You $0.50 – 1.50 per Gallon

Renewable Fuels Act

According to a new analysis by renowned energy economist Philip K. Verleger – who has served as an energy advisor to both Republican and Democratic Presidents – American consumers are saving between $0.50 and $1.50 per gallon on gasoline as a direct result of increased ethanol production under the Renewable Fuels Standard (RFS).

“The implication for world consumers is clear,” says Verleger. “The (Renewable Fuels Standard) has cut annual consumer expenditures in 2013 between $700 billion and $2.6 trillion. This translates to consumers paying between $0.50 and $1.50 per gallon less for gasoline.”

The reasons for the savings involve the lower cost of domestic ethanol compared to gasoline, as well as the effect of increased ethanol use driving down overall demand for petroleum-based fuels. The Renewable Fuels Association (who, admittedly, are probably less objective than Mr. Verleger) claim, on their website, that “crude oil prices would be between $15 – 40 per barrel higher today without the substantial volumes of ethanol that have been added to petroleum inventories since enactment of the RFS.”

Verleger’s report is just one of the many pieces of evidence that, despite big oil’s unethical anti-ethanol business practices and price-gouging, the Renewable Fuels Standard is working to improve America’s overall health, add new jobs in a tough economy, reduce food costs, and all with AAA support. At least, that’s what court after court has found in their in-depth analysis of the issues involved.

What about you, dear readers? Are you fed up with big oil’s nonsense, yet, or are you still frothing at the mouth with anti-ethanol hysteria? I’m sure you’ll let us know, either way.


Sources | Photo: Modified Magazine, Philip K. Verleger, via Renewable Fuels Association.

Jo Borrás

I've been in the auto industry 1997, and write for a number of blogs in the IM network. You can also find me on Twitter, at my Volvo fansite, out on two wheels, or chasing my kids around Oak Park, IL.