Northwest Indiana area drivers slowly warming up to E85

Gus Olympidis, president and CEO of Valparaiso-based Family Express, began a program that will ultimately bring an E85 pump to all of the company's 47 gas stations. Family Express has committed to Gov. Mitch Daniels 20 installations in 2007.

"We are well under way in meeting this goal," Olympidis said.

Family Express has E85 at 10 of its stores including those in Hobart, Valparaiso, Michigan City, Roselawn and Wheatfield. They will be added at Chesterton, Lakes of the Four Seasons, Ameriplex and Kouts this year.

Olympidis declined to comment on just how many gallons of E85 the company has been selling since the pumps were added, but said "it has surprised us in a positive sense."

He said the decision to add the E85 pumps was base more on what E85 means for the economy locally and the nation as a whole.

"It's the right thing to do," he said.

Demand for gasoline will only increase as people in countries such as China and India become upwardly mobile.

"To not be using E85 in Indiana is just irrational. It is our fuel produced by our farmers in our back yard."

There is no shortage of E85 flex fuel vehicles available to consumers, according to Al Kuchar, general manager of Mike Anderson Chevrolet in Merrillville.

GM has more than 2 million flex fuel vehicles on the road in the U.S., with another 400,000 expected to be produced this year. The dealership has experienced a dramatic increase in the past year of flex-fuel vehicle sales, but declined to comment on an exact number.

"I think anything that reduces our reliance on foreign oil interests the auto buyer," Kuchar said via e-mail.

However the bigger question, he said, is how many people who buy the E85 compatible vehicles actually use the fuel.

"I am personally driving an Impala with a flex-fuel engine that has never used E85 because I haven't bothered to visit a station offering E85," he said.

Ethanol has less energy content than gasoline. However, E85 also has a much higher octane -- ranging from 96 to 105 -- than gasoline.

Flex-fuel vehicles are not optimized to E85, so they experience a 10 percent to 15 percent drop in fuel economy, he said. This will vary based on the way one drives, the air pressure in the tires, and additional driving conditions.

He said increased availability and price competitiveness will be what drives up the interest in E85.

"The American consumer is value-driven. E85 will be the fuel of choice when the case for its efficiency and price competitiveness can be made," Kuchar said.

Phil Lampert, executive director of the National Ethanol Vehicle Coalition, agreed.

"E85 has to be priced less than regular unleaded. Our rule of thumb is 15 to 20 percent less," Lampert said.

The lower price will make up for the lost miles per gallon: "At that point the consumer doesn't loose any money."

The problem right now, he said, is strong demand for ethanol has kept the price up.

"We as an industry need to address those issues," he said.

Lampert said that with the addition of more ethanol plants under construction, the price of ethanol should be lower when the plants come on line.

While consumers would like to be green-minded, most are not going to pay more to make it happen, he said.