Biofuels are increasingly competitive: Study
NEW YORK -- A new study in the U.S. shows that alternative fuels are 29 percent more cost-competitive than they were three years ago when compared to their hydrocarbon counterparts. The study, released by the Energy Management Institute, says the five commercially viable alternatives recognized by the U.S. Department of Energy showed big comparative gains. Biodiesel is 29.2 percent more cost-competitive than in was in 2004. Ethanol is 17.4 percent; Natural gas 41.4 percent; and propane 21.3 percent. The study was conducted by analyzing three years of pricing data collected from more than 80 urban areas across all 50 states. "We crunched a lot of data for this one," said J. Scott Susich, Editor of EMI's Alternative Fuels Index publication. "It's not enough to look at prices from three years ago and compare them to recent values. We looked at the relationship between the cost of each fuel and the amount of energy one could buy on a BTU equivalent basis, and compared those values to their gasoline and diesel counterparts in each market." Next, says Susich, the firm looked at those trends to determine whether the results were atypical or part of a sustained pattern. "In each case the data showed a continuing trend toward competitiveness," Susich continued. Gains were seen in the decades-old fuel ethanol industry as well as the more fledgling biodiesel market. When compared to crude oil, the five alternative fuels became 32.5 percent more competitive over the three years. These results were achieved during some of the most volatile years in energy industry history as crude oil more than doubled to over $75 while Gulf Coast hurricanes wiped out more than a quarter of U.S. production capacity. The data clearly demonstrates the continued and growing viability of domestic renewable fuels, concludes EMI.