Fuel Miles and the Blend Wall: Costs and Emissions from Ethanol Distribution in the United States

From 1991 to 2009, U.S. production of ethanol increased 10-fold, largely due to government programs motivated by climate change, energy security, and economic development goals. As low-level ethanol gasoline blends have not consistently outperformed ethanol-free gasoline in vehicle performance or tailpipe emissions, national-level economic and environmental goals could be accomplished more efficiently by concentrating consumption of gasoline containing 10% ethanol (i.e., E10) near producers to minimize freight activity. As the domestic transportation of ethanol increased 10-fold in metric ton-kilometers (t-km) from 2000 to 2009, the portion of t-km potentially justified by the E10 blend wall increased from less than 40% to 80%. However, we estimate 10 billion t-km took place annually from 2004 to 2009 for reasons other than the blend wall. This unnecessary transportation resulted in more than $240 million in freight costs, 90 million L of diesel consumption, 300,000 metric tons of CO2-e emissions, and 440 g of human intake of PM2.5. By 2009, the marginal savings from enabling Iowa to surpass E10 would have exceeded 2.5 g CO2-e/MJ and $0.12/gallon of ethanol, as the next-closest customer was 1600 km away. The use of a national network model enables estimation of marginal transportation impacts from subnational policies, and benefits from policies encouraging concentrated consumption of renewable fuels.