Grain Bins


Study: Ethanol saves Midwesterners $1.69 per gallon

Posted on May 15, 2012

A new study conducted by university economists shows that Midwestern drivers saved $1.69 per gallon of fuel last year because of domestic ethanol production and use.
The Midwest fared the best in the study that was done by Dermot Hayes of Iowa State University and Ziaodong Du of the University of Wisconsin. Nationally, consumers saved $1.09 per gallon. The Center for Agricultural and Rural Development released results of the study today.
Chad Blindauer, president of the South Dakota Corn Utilization Council, said most consumers have no idea how much more it would cost to fill up their vehicles if it weren’t for ethanol.
“Having access to American ethanol generates a significant savings for hard-working families in South Dakota and the rest of country, which typically goes unnoticed,” said Blindauer, a Mitchell farmer and rancher. “It’s important for consumers and policy makers at all levels to understand just how much of a positive impact the ethanol industry truly has on our country.”
The study shows that ethanol reduced the average American household’s spending on gasoline by more than $1,200 in 2011. The $1.09-per-gallon national impact is up from 89 cents per gallon in 2010, a change the researchers attribute to increased ethanol production and higher crude-oil prices as well as a bigger price difference between ethanol and gasoline.
The average price for a barrel of crude oil increased to $95 in 2011, up from $80 in 2010.
The study determined that drivers would have paid an average of about $4.60 per gallon last year without the inclusion of 13 billion gallons of ethanol.
“While it’s hard to imagine that gas prices could be even higher than they are now, this study clearly underscores that the current pain at the pump would be far worse without ethanol,” said Bob Dinneen, president and CEO of the Renewable Fuels Association.

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