Alternative Fuel Pumps Mandatory by 2018

Yeah, we’re still digging through House Resolution 6899 — the Comprehensive American Energy Security and Consumer Protection Act — and guess what we found? While the second section of the bill deals with new offshore drilling, 70 or so sections later, under “Miscellaneous Provisions,” is a requirement that every gas station owned by a major gas company — Shell, BP, etc — add at least one alternative fuel pump by 2018.

“Alternative fuel pump” means any pump that holds natural gas; E85 or a higher concentration of ethanol; biodiesel or renewable diesel; or hydrogen. 

If these companies don’t retrofit by 2018, they’ll be fined $100,000 per station. In another section of the bill, there’s a $50,000 tax credit for every station that adds an E85 pump. That credit is good until 2017. So if the companies add E85 it will cost them roughly $50,000 less than any other alternative fuel.

If you’re wondering, there is no provision in the bill to aid automakers with new technology. However, local governments and coal and other energy producers will get billions in loans, similar to what the automakers are looking for, to aid them in going green. 

The bill passed the House of Representatives yesterday by an overwhelming majority and now goes to the Senate, where a decision will be reached over the next few weeks.

Comments

[DodgeFan]

Finally an incentive to get pumps out there to consumers. I think E85 will be the most popular one right now. The article is wrong in that "So if the companies add E85 it will cost them roughly $50,000 less than any other alternative fuel.". Based on its previous statements in article your get a tax credit of 50K per pump at a station installed and not fined a 100K per station. There is no savings thats the wrong idea. This is a carrot/stick situation.

[bob Moffitt]

"If you’re wondering, there is no provision in the bill to aid automakers with new technology."

The extra cost of making vehicles flexible fuel -- able to use E85 as well as gasoline -- is relatively small. perhaps as little as $100 per vehicles in mass production. Biodiesel blends can be used in any diesel engine without modification. Of course, the other alt fuels are a different matter.

[Dave T.]

Bob,
That's not what automakers are looking for with the loans. FFVs are easy to make and they all have them. The loans are to help fund R&D to build more Chevy volts etc to meet cafe standards.

DodgeFan,
If everyone has to put one pump into a station or face a fine, the E85 option would get a $50,000 incentive. Thus costing less than any other fuel they pick. They wouldn't get fined if they had it in place in time. Not sure what you're asking.

[starlightmica]

The bill passed the House with a 236-189 vote, less than a 60% majority required to override Bush's promised veto.

If this kind of provision passes, the other Big Oil companies might just then follow ExxonMobil's lead and proceed to sell all their gas stations, turning them into franchises. Gas stations are barely profitable in the big scheme of things.

[Dave T.]

SLM,
Good Point!
Of course who will be able to secure a loan to buy a gas station franchise anyway?!

[Bob Moffitt]

Thanks for the clairification. Chevy is rolling out E85-ready HHRs (four cylinder, the smallest FFV yet)and Malibo.

[J]

okay, they are fitting the alternative fuel pump.
But at the consumers' expense.

[starlightmica]

Dave T. -

Ha!

BTW, if you run into my blog posting about this topic at a web site that starts with the letter T, the "Reverend" in front of your name wasn't my idea, it was the editor's.

[Skinner]

Yay, more ethanol!
We don't need to waste farmland on stupid things like food, anyway.

[alex]

ok lets have some straight talk here. E-85 is a joke, a disaster, and a total loser. Like i have said before, e-85 is the creation of iowa being the first state in the primary. No politican shall dare cross the farmer in iowa that gets to meet every candidate 10 times. e-85 is making no difference in global warming, reducing our realiance on saudi and chavez oil, and has literally caused riots in the 3rd world. But, congress is still trying to sholve this down the throats of the american people. Let the market work! people will cut back on gas, flock to new technology, (prius still sells great even though the tax credit is gone), imagine that, no government support, and it can still sell!!!! SHOCKING!! Less regulation, not more!

[alex]

also starlightmica, might want to brush up on constitution 101, it takes 2/3 majority in both houses to override a veto, not 60% as u incorrectly stated.

[Adrock]

I thought at first the bill was a "require an alternative and let the market sort out the best one" sort of compromise. But given that the E85 conversion gets an incentive while none others do, that is clearly not the case.

Are there any provisions in the bill to support or subsidize home charging stations for plug-ins? There should be.

[Anne]

While I agree that corn-based ethanol made from Monsanto seed, Roundup and a healthy dose of fertilizer is a dead end, I have to disagree that ethanol is a dead end. The current estimate is that the world wastes half the food it produces and ethanol can be made from waste food -- that means expired bread, table scraps currently going to the dump, fruit not good enough for the store, everything. Ethanol is made the way it is now because of the rules restricting alcohol manufacture and because of fuel distribution. It is easy to make ethanol in small plants with local sources of fuel and to sell it at a community level. Instead, we have think we have to buy from Exxon, and to make it worth Exxon's while, they have to be able to pick up a tanker-full at the Port of New Orleans.

Also, the HHR isn't the smallest FFV available. I believe that goes to the Honda Fit available only in Brazil, which makes ethanol from sugar cane grown in the country. Honda also makes an FFV Civic for sale there.