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| May 16, 2012 |
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Ethanol reduced gas prices by $1 in 2011
 If it weren't for ethanol, the nation could have already hit $5 per gallon for its gasoline, according to an updated study.
The research, performed by economics professors at the University of Wisconsin and Iowa State University, showed the downward impact of adding ethanol to gasoline has reduced wholesale gasoline prices by $1.09 per gallon. The same study conducted in 2010 showed only an 89-cent impact.
The savings at the pump have ramped up in recent years as the cost difference between ethanol and gasoline inch apart. In the region consisting of Wyoming, Colorado, Montana, Idaho and Utah, ethanol dropped gas prices by an estimated average of 30 cents per gallon over the past 12 years, even factoring in the current drop of $1.09.
"Growth in U.S. ethanol production has added significantly to the volume of fuel available in the United States," said Professor Dermot Hayes from Iowa State. "It is as if the U.S. oil refining industry had found a way to extract 10 percent more gasoline from a barrel of oil. This additional fuel supply has alleviated periodic gasoline shortages that had been caused by limited refinery capacity."
Even so, federal and state subsidies for ethanol have waned in recent years, making it more difficult for ethanol manufacturers to keep in the black. In this year's legislation, Wyoming yanked a 40-cent ethanol tax credit, popping the bubble — or perhaps kernel — of Wyoming's sole ethanol manufacturer.
"I feel like the rug’s been pulled out from under me, frankly," said Terry Oldfield, CEO of Renova Energy, the Boise, Idaho-based company that owns Wyoming Ethanol. "I think the state of Wyoming gave up on their word on us."
The credit will expire July 1, 2015. Meanwhile, legislators who pulled the plug argued that the money used to subsidize ethanol could be better used elsewhere, namely on Wyoming's underfunded highway system.
"I think this body needs to consider how many failed industries we can support," Rep. Jim Roscoe from Sublette County reportedly said during legislation.
In Wyoming, gas stations are required by law to place a sticker on pumps declaring ethanol content. The gas substitute has been shown to cause certain engine problems, particularly in older vehicles.
Study results may be viewed here. |
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Roadless Rule heads to Supreme Court
After years of volleying between federal and state control, Wyoming has placed the Roadless Area Conservation Rule back in the hands of the U.S. Supreme Court.
The Roadless Rule, as it is commonly known, originated in the Clinton administration, making new roads off limits for almost 50 million acres of national forest land. The Bush administration rerouted control of the lands to states in 2004. But in 2006, a federal court reinstated the rules barring road building, logging and development on the lands. Since then, states have been individually fighting the rule on various grounds.
Wyoming has figured prominently in the fight. With 3.2 million acres of forest land hanging in the balance, the state has argued that the U.S. Forest Service usurped the power of Congress and violated the 1964 Wilderness Act to instate the rule.
A federal judge in Wyoming twice overturned the Roadless Rule nationwide, but an October decision by a Denver appeals court reversed the lower court's decision, leaving Wyoming to seek higher recourse. If this effort fails, it will likely be Wyoming's last chance to reverse the rule.
"This has real impacts for multiple use in Wyoming, and the rule was developed without meaningful input from any state, county or town," said Gov. Matt Mead in a statement. "This rule affects our economy and our ability to fight the bark beetle epidemic."
Despite environmental appeals like Mead's, environmentalists have largely lauded the overturned ruling.
"Roadless areas in our national forests provide a refuge for America's wildlife, protect the sources for much of the nation's pure drinking water and are a recreational haven for millions of hunters, anglers and hikers," said Earthjustice attorney Tim Preso. "We'll work to protect America's best roadless forests and defeat Wyoming's last-ditch attempt to bulldoze, drill and clear-cut these irreplaceable natural areas." |
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Rep. Lubnau: Speak up for Wyo. energy
From coal and natural gas to uranium and oil, Wyoming has the fossil fuels the American economy needs to provide its citizens with low-cost, efficient energy, according to Lori Cameron, executive director of the U.S. Energy Council.
"It's all here in Wyoming," Cameron said during a luncheon Tuesday in Gillette sponsored by the Campbell County Chamber of Commerce and Wyoming Business Alliance. The annual Business Alliance Indicator Meeting provided attendees with a look at the various factors impacting Wyoming's economy, both now and in the future.
Cameron said some of the current concerns of the U.S. Energy Council include present and upcoming regulations that impact the environment, economics and national security.
While United States citizens and political officials debate building the Keystone XL TransCanada Pipeline project, creating ports to export coal to other countries and other projects, already several countries are stepping into the international energy field, Cameron said.
"They [China] move fast and strategically," Cameron said. "In the last few years, China invested $16 billion in Alberta's oil sands."
While China and other Asian countries are looking at ways to meet their energy growth needs, Oregon’s governor recently requested federal agencies to evaluate the environmental impacts of coal-export projects in the Northwest. For a state like Wyoming that provides more than 40 percent of the country's coal energy needs, a growing angst against coal and other fossil fuels is concerning, Cameron said.
"Wyoming has a tremendous amount at stake," Cameron said. "The request by the Oregon governor is extremely troubling. If coal can be scrutinized, any export can be, and that's huge."
For that reason, Wyoming Rep. Tom Lubnau said it is absolutely essential that Wyoming residents speak up for the state's energy industries and what they have to offer the country.
"Electricity is not an energy source in and of itself," Lubnau said. "The use of energy is good."
Having access to energy decreases infant deaths, increases life expectancy and adds to the quality of life, Lubnau said. For that reason, providing access to energy is something many of the underdeveloped and developing nations like China want to tap into.
"Those folks see what we have and they want it," Lubnau said. "We have come as a country to take for granted energy. We never talk in this debate about how many lives are better because we have electricity."
According to Lubnau, world energy demand is expected to increase 300 percent by 2030, making it critical for Wyoming and the country as a whole to be prepared to meet that demand. Speaking up about the realities of coal, natural gas and other fossil fuel production is vital to maintaining Wyoming’s position as an economically healthy state, Lubnau said.
"We need to advocate for ourselves," Lubnau said. "We cannot remain silent while someone else is presenting half the argument."
Additional Business Alliance Indicator meetings will take place today in Worland and Cody, May 21 in Riverton, May 22 in Jackson and Pinedale, May 23 in Rock Springs and Saratoga. For more information, visit www.wyomingbusinessalliance.com or call 307-577-8000.
Look for an extended article on the current state of the coal industry in the June issue of the Wyoming Business Report. |
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