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Ted Cruz Makes Questionable Claim on Market Access for Ethanol

Ted Cruz appeals to Iowa corn growers on ethanol Ted Cruz appeals to Iowa corn growers on ethanol[/caption] Texas Senator and presidential candidate Ted Cruz has made it clear he favors ending the Renewable Fuel Standards (RFS) mandated by federal government as well as subsidies of corn ethanol blended into gasolines used by most of our automobiles. After rival candidate Donald Trump hit Cruz on the issue, the Texas Republican Senator has made an argument for more “market access” for gasolines with higher ethanol blends to appeal to the corn farmers of Iowa, convincing them that his policies would lead to higher sales of their product. Ted Cruz is echoing the argument being made by the ethanol industry, that there needs to be more market access for higher ethanol blends in gasolines. Cruz says he would repeal government regulations preventing this. Cruz says he would use anti-trust laws to prevent oil companies from blocking the same of higher ethanol blend gasolines, something that is not all taking place. The oil industry can’t block the sales of gasoline with higher ethanol blends.for Iowa corn farmers there is an even more important government rule that needs to be repealed to take advantage of this level playing field. Right now, the EPA — through regulations on fuels used in vehicle emissions tests — imposes a hard wall against mid-level ethanol blends, such as E25 (25 percent ethanol, 75 percent gasoline), making it largely illegal to sell gasoline with higher blends of ethanol,” Cruz wrote in his op-ed on the issue. The lack of availability of higher ethanol gasoline is due to the lack of consumer demand for gasoline with 15 percent or higher blends of ethanol. Even if there is very much popular consumer demand for higher ethanol gasoline, most cars are not equipped to burn gasoline with any more than 10 percent ethanol in the gasoline, and most cars do not perform as well on that gasoline as they on pure 100 percent ethanol-free gasoline. My own personal testing in the past showed that my car got 400 miles from a tank of gasoline with 10 percent ethanol blended in, and 440 miles on pure 100 percent gasoline without corn ethanol. Those numbers suggest the 10 percent ethanol content in gasoline has little or no value as an effective motor fuel. Ted Cruz blames the EPA blend wall for limiting market access to gasolines with higher ethanol blends. But just two days ago while traveling through Iowa and South Dakota, I stopped at a few Clark gas stations that offered both 15 percent and 30 percent ethanol blend gasolines. Clearly the EPA blend wall doesn’t prevent this gasoline retailer and others from voluntarily offering their customers gasolines with higher ethanol blends. But the reason why most Marathon, BP, Exxon or other gasoline brands are not offering these higher blends yet is related to the lack of customer demand for them. Few consumers are clamoring for gasolines with higher corn ethanol blends because most are driving cars not equipped for it. I applaud Ted Cruz for making an argument in favor of the free market, and I’m all for that. But corn ethanol is not a product of the free market, but only one that exists because it’s heavily subsidized by federal taxpayers, and in the absence of those subsidies, would quite likely cease to exist because it has little or no demand in the free market. Cruz should simply stand for the free market, and against subsidies, by opposing the RFS mandates for corn ethanol without making the hollow and empty argument in favor of “market access” for a product that wouldn’t even be on the market if not for the massive federal subsidies that keep it alive. ]]>

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