Biofuels

1. 1991 – 2011: A 20 Year History of Biofuels policy and the impact on the Recreational Marine Industry Thom Dammrich, NMMA Biofuels

2. Gasoline plus ethanol consumption 1991 - 2001 Fuel Ethanol Consumption % Ethanol in Gasoline Pool 2 Source: Energy Information Administration

3. Clean Air Act 1990 Mandated the use of oxygenates (MTBE) for reformulated fuels in non-attainment areas starting in 1995 1995 MTBE Production 3

4. MTBE Phase-out begins 1995 - 2001 MTBE Production 4

5. In 2006 ethanol production exceeded RFS quantity 2006 Production exceeded the mandate RFS-I Ethanol Quantity 5

6. Energy Independence and Security Act of 2007 (RFS-II) 2007 6

7. Energy Independence and Security Act of 2007 (RFS-II) 2007 RFS-II Biofuels Quantity 7

8. Global Financial Crisis 2007 – 2011 8

9. Global Financial Crisis 2007 - 2011 % Ethanol in Gasoline Pool = 10% 9

10. Global Financial Crisis 2007 - 2011 % Ethanol in Gasoline Pool = 10% 10

11. A DOE Funded Mercury Marine and Volvo Penta study of the effects of running 15% ethanol concentration in current production 4-stroke engines and “legacy” 2-stroke engines • Verado 300 hp Outboard – Mercury Marine • 9.9 hp four stroke outboard- Mercury Marine • 200HP EFI 2.5L 2 Stroke- Mercury Marine • 4.3 Liter Volvo Penta Inboard Engine

12. Cylinder 3 Top Valve Cylinder 6 Top Valve

13. Remaining Pieces from Cylinder 3 Rod Bearing Cage Undamaged Bearing Undamaged Rod Rod from Cyl 3

14. Solutions: Quickly start consuming more gasoline (ridiculous) Realign the RFS to match the new fuel demand reality (unlikely - does nothing to address the growth of the ethanol industry) Raise the amount of ethanol allowed in gasoline (E15 waiver request granted – source of much debate, will cause issues) Explore other alternative fuels that can better satisfy the RFS volumes without affecting millions of existing engines The US Market was saturated with ethanol in 2010. The industry cannot continue to grow beyond that of exports. 5. Solutions 14

15. What is Butanol? A four carbon alcohol (C4H9OH), colorless, neutral liquid of medium volatility with a characteristic banana-like odor. Traditionally petrochemical derived - Generally used to make other chemicals, or used as a solvent or an ingredient in formulated products such as cosmetics.

16. Butanol Properties: Butanol 99,800 BTU/gallon Gasoline 116,000 BTU/gallon Approximately 86% of the energy content of gasoline Ethanol 76,300 BTU/gallon (68% of the energy content of gasoline)

17. Butanol Properties: Phase Separation As water enters a boat fuel system containing ethanol-extended fuels, phase separation may occur creating an ethanol/water fuel mixture. Butanol does not phase-separate as shown in the cylinder on the right Figure 1. Effect of adding 10% water by volume to 85% ethanol and 10% water by volume to 85% butanol

18. Butanol Introduction: • Less susceptible to phase separation means butanol could be successfully delivered in existing pipelines • Eliminates need for splash-blending • Least corrosive of alcohols • Higher energy content – can be blended into gasoline at higher percentages than ethanol

19. Purpose of Testing: To evaluate the effect of butanol-extended fuels in a harsh marine environment and to see if there is a better alternative to ethanol-extended fuels

20. Test Set-up: On-water emissions testing using the Marine Portable Bag Sampling (MPSS) unit developed for the EPA/NMMA green house gas study.

21. EPA’s Second Plan for Flex Fuel VehiclesIn-use E51-83 • E51-83 is not considered gasoline, & therefore has not yet been subject to Part 80 gasoline standards or Part 79 F&FA registration and health effects testing • No specific regulations for in-use E51-83 quality • Gasoline, & BOBs have historically been used to manufacture E51-83 • In-use E51-83 must be sub-sim to the fuel the FFVs were certified on - mixtures of finished gasoline and ethanol • Only RFG, RBOB can be used in RFG areas • But while helping to provide assurance of E51-83 quality, the current situation is creating barriers to E51-83 expansion • Often unable to make E51-83 blends in the high-ethanol content range with the current hydrocarbon blendstocks because the volatility can be too low for good vehicle startability/performance

22. Natural Gasoline: Potentially A Nice Fit as an E51-83 Blendstock • Domestic natural gasoline supply expected to increase substantially with growth in natural gas and tight-oil production • U.S. NGL production projected to increase ~45% from 2012 to 2017 (3,250 Mb/d by 2017) • No clear home for increased volumes. • Butane/pentane would be useful RVP trimmers

23. Natural Gasoline Blending Might Help Make E51-83 more Economical <1% savings 7% savings 11% savings - Use of butane as RVP trim might be handled similar to gasoline. July cost data used. - RVP of >E10 blends limited to 9 RVP. ASTM current maximum RVP for E51-83 is 8.5 RVP.