A three-year study conducted by the <a target="_blank" href="http://
 www.energyinstitution.org">Energy Management Institute</a> (EMI) concluded that alternative fuels are cost competitive with their hydrocarbon-based counterparts. EMI released some of the results of the study earlier this week.
 

 The study was conducted by analyzing three years of pricing data collected from more than 80 urban areas across all 50 states. "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," said Scott Susich, editor of EMI's Alternative Fuels Index. "Next we had to look at the trends of those relationships to determine whether the results were atypical or part of a sustained pattern. In each case the data showed a continuing trend toward competitiveness."
 	
 The fuels ranged from being 17.4 percent more cost-competitive for ethanol to 41.4 percent for natural gas. Biodiesel was listed as 29.2 percent more cost competitive, despite significant process technology advances over the course of the study. "I expected to see biodiesel—as a new, immature market and industry—change in big increments over a period of the past couple of years," Susich told EthanolProducer.com. "But ethanol … production technology is getting better. It was interesting to see something like ethanol, which is much more mature, is still increasing in competitiveness." 
 
 Susich attributed the increase to improved efficiencies in process technology.
 
 The volatility of the crude oil market of the past three years may have played an impact in alternatives' cost competitiveness. Susich agrees.
 	
 "Either way you look at it, alternatives became cost-competitive due to market influences," Susich said. "Some say alternatives look better because of Hurricane Katrina and Iraq. I'd say, great. That stuff isn't going away. It's indicative of our dependence on foreign oil."
 
 Dave Nilles is Online Editor for Ethanol Producer Magazine. Reach him at <a href=mailto:"dnilles@bbibiofuels.com">dnilles@bbibiofuels.com</a> or (701) 373-0636.
 

 Posted: 12:01 p.m. CST Wednesday, January 24, 2007

EMI study finds alternatives are cost competitive

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EMI study finds alternatives are cost competitive