Eastern Railroad Discussion > About the ethanol IN those unit trains

There's an interesting article in the NY Times today about the economics and politics of ethanol, and what may change soon.  Most class 1 lines haul a significant amount of the alcohol product which is blended into gasoline. Losing the ethanol business would be a huge blow to railroads.  The unit trains of ethanol are necessary since ethanol and pipes do not get along well. The stuff attracts moisture like a sponge. And refineries or blenders (places where gasoline and ethanol are mixed to create a for-sale product) are often in places other than where ethanol is produced.

Ethanol is mixed with gasoline to create a motor fuel in the US. It was originally introduced as a means to "extend" gasoline in the face of Arab oil embargos, and to replace certain banned additives. Some cynics would say it was also a way to provide a reliable corn market for US farmers. Congress requires that ethanol has to be blended into gasoline, or a "credit" be purchased from somebody who has surplus ethanol, originally another refiner. These credits,or RINS, now trade as financial instruments.  And the price of a RIN has skyrocketed.

Valero says it will spend 800 million dollars this year buying credits,on top of those it already has from its own ethanol business.  Cargill,ADM and other producers say the system works as intended (they make a lot of money producing ethanol and credits). Other refiners, like RaceTrac have refineries that create surplus credits which can be sold. And price of crude oil has dropped like a stone, now selling for less than the ethanol extender at wholesale.



NY Times; High Price of Ethanol Credits

 

How will this impact the railroads?

If the ethanol mandate goes away,most of the rail traffic carrying ethanol to the refineries or blenders will go away, too.  Right now, the credits business is a financial trade (because of the very high prices) which may cause the politicians to scale down the value of th credit, or cap the amount of ethanol needed.  Here in northern NJ, we see three or four trains a week to Tremley / Linden, and one or two into Motiva / Sewaren. The traffic varies widely.  I believe several south Jersey and Philly refineries get unit trains of ethanol, too.

The Bakken and Permian oil producers would be delighted to see the mandate disappear, altogether. That means more oil sold.

Big oil would love to see ethanol done away with totally.

Posted from iPhone

Some adjustments will have to be made in the RINS market, probably in 2017, but on a whole I don't see ethanol ever going away.  None of the major producers see any kind of major crisis ahead, although there appears to be pressure on the EPA to cap Renewable Fuel Standard volumes starting in 2017.  To complicate matters there is concern any cap, along with a record corn crop, will push corn prices down to low levels not seen in many, many years, hurting corn farmers.  In any event 2016 will likely see both record corn and ethanol production.  Of course the big unknown, right now, is just how much export demand there will be for both.


Allen
 



Edited 3 time(s). Last edit at 08/23/16 08:59 by bradleymckay.

Ethenol is a truly lousy motor car fuel, other than in race cars, where it is merely a pain in the butt.  Given a real choice, not one drop of it would ever find its way into any of my engines.

Subsidy or no, ethanol currently is the oxygenate of choice for regular motor fuel. Even if E85 consumption dwindles, clean-air regulations are going to keep ethanol moving until a new substitute is identified.
 

      I will never use an ethanol fuel in my vehicles again if possible. My costs per mile are less with 100 % gasoline and I no longer have fuel pump problems. The ethanol loves water and will take it through your vehicle's system creating havoc that will show up later and cost your rear. It is garbage.

I don't see ethanol blended fuels going away. Reason is that the oil refiners/blenders have figured out that ethanol is a cheap way to boost octane. Thus, the octane of the gasoline coming through the pipeline is either 85 or 91. Add 10% ethanol at the terminal and 85 becomes 87 octane E10 fuel. The 91, with a 10% ethanol addition becomes 92-94 octane premium.

dcfbalcoS1 Wrote:
-------------------------------------------------------
>       I will never use an ethanol fuel in my
> vehicles again if possible. My costs per mile are
> less with 100 % gasoline and I no longer have fuel
> pump problems. The ethanol loves water and will
> take it through your vehicle's system creating
> havoc that will show up later and cost your rear.
> It is garbage.

There must be something fundamentally wrong with your car - the small quantity of ethanol added to fuel should have no adverse effect on running.

10% is not a small amount, especially if you don't have a vehicle specifically designed for it.  It also creates havoc with small engines, causing corrosion and hard strarting issues.

If ethanol is bad for pipelines and cannot be shipped that way, I am concerned about it being in my vehicles.  I see ethanol as a vote buying effort by a certain group of elected government officals to get votes in Iowa, Illinois, and other farm states.
​All boats at our lakehouse are using only pure gasoline, no ethanol, as instructed by the boat dealers in the area.

gmojim

i would too ,  and I wish companies would stop contaminating gasoline with it.

farmer Wrote:
-------------------------------------------------------
> Big oil would love to see ethanol done away with
> totally.
>
> Posted from iPhone

I think there's a bit of confusion here (not surprising).  There are two blend levels for ethanol,  E10 and E15 (each denotes the percentage of ethanol to gasoline).   E10 has been around for years (decades?) As mentioned in a previous post, E10 also allowed the phase out of MTBE which was added for anti-pollution reasons, and is believed to be a cancer causing agent.   As for car performance,  unless you're still driving something from the pre fuel injection era - you shouldn't have issues. E15 on the other hand is limited for use in autos that have been equipped for it's use (different fuel line materials etc.)  These tend to be Detroit 3 makes and will have "flex fuel" etc. badging on them.   Small engines (lawn mowers, snow throwers etc.) will fare a bit differently mostly due to the infrequency of use and the practice of having a fuel can that may sit partially full for long periods of time.   In other words, in the pre E10 days,  one could have a can of gas for the mower in the shed over the winter and more often than not use it in the spring with a good chance of success.  E10 on the other hand,  unless you put Sta-Bill in it,  it's not going to work.

MSchwiebert Wrote:
-------------------------------------------------------
> I think there's a bit of confusion here (not
> surprising).  There are two blend levels for
> ethanol,  E10 and E15 (each denotes the
> percentage of ethanol to gasoline).   E10 has
> been around for years (decades?) As mentioned in a
> previous post, E10 also allowed the phase out of
> MTBE which was added for anti-pollution reasons,
> and is believed to be a cancer causing agent.  
> As for car performance,  unless you're still
> driving something from the pre fuel injection era
> - you shouldn't have issues. E15 on the other hand
> is limited for use in autos that have been
> equipped for it's use (different fuel line
> materials etc.)  These tend to be Detroit 3 makes
> and will have "flex fuel" etc. badging on them.  

I thought "FlexFuel" vehicles were designed to be able to use E85.

junctiontower Wrote:
-------------------------------------------------------
> Ethenol is a truly lousy motor car fuel, other
> than in race cars, where it is merely a pain in
> the butt.  Given a real choice, not one drop of
> it would ever find its way into any of my engines.

AMEN!!!
The damage it has done (and continues to do) in automotive engines was and never will be considered by the EPA.  The rising cry of ongoing repair and maintenance expenses incurred by using this crap has driven many fuel stops here in the intermountain west to offer non-ethanol fuels, from 88 all the way up to 110 octane.

I have been using ethanol in my vehicles for decades and have had none of the issues mentioned above. Cars are made to use it and small engines can use the 10% formulation without problems. The ethanol is a railroad hauled producd and so are the byproduct corn that is not used in the process. The distillers grains are used for feed and lots of it is also exported.  The railroads also haul fertilizer and other inputs to grow the corn.

Bruce Stikkers
St. Joseph, IL

BruceStikkers Wrote:
-------------------------------------------------------
> (SNIP)The
> ethanol is a railroad hauled producd and so are
> the byproduct corn that is not used in the
> process. The distillers grains are used for feed
> and lots of it is also exported.  The railroads
> also haul fertilizer and other inputs to grow the
> corn.
>(snip)

Yes.  You expressed it better than I did in the initial post.

If the ethanol requirement is dropped or weakened, the railroads will lose a lot of direct and indirect traffic

E85 is 15% ethanol.  Sorry for the confusion.

toledopatch Wrote:
-------------------------------------------------------
> MSchwiebert Wrote:
> --------------------------------------------------
> -----
> > I think there's a bit of confusion here (not
> > surprising).  There are two blend levels for
> > ethanol,  E10 and E15 (each denotes the
> > percentage of ethanol to gasoline).   E10 has
> > been around for years (decades?) As mentioned in
> a
> > previous post, E10 also allowed the phase out
> of
> > MTBE which was added for anti-pollution
> reasons,
> > and is believed to be a cancer causing agent.
>  
> > As for car performance,  unless you're still
> > driving something from the pre fuel injection
> era
> > - you shouldn't have issues. E15 on the other
> hand
> > is limited for use in autos that have been
> > equipped for it's use (different fuel line
> > materials etc.)  These tend to be Detroit 3
> makes
> > and will have "flex fuel" etc. badging on them.
>  
>
> I thought "FlexFuel" vehicles were designed to be
> able to use E85.

E85 is 85% max ethanol, although usually it comes in around 70% ethanol. Flex fuel vehicles can use E85 as well as E0, E10 and E15. The EPA has approved E15 only for model year 2000 and later cars and light trucks. EPA has not approved it for motorcycles, boats, ATV's boats and power equipment.