in June 2017. Many retailers have been hesitant to add E85
for several reasons:
1. The number of FFVs in the market limits potential
market demand. FFV penetration has not surpassed 10
percent of vehicles on the road.
2. Not all FFV drivers purchase E85. No one knows how
many FFV drivers realize their vehicles can operate
on E85. But those drivers who know about E85 are not
required to purchase the fuel; they can buy gasoline, E85
and anything in between.
3. E85 contains on average 27 percent less energy than
E10. Simply, FFVs travel fewer miles per gallon. E85
must be priced far below competing E10. Even if a
consumer recognizes a value comparison between the
fuel prices, having to refuel more frequently can prompt a
potential E85 purchaser to look for something else.
4. E85 requires special equipment. All equipment at a retail
fueling station must be listed by Underwriters Laboratories
as compatible with the fuel being stored and dispensed.
Assuming the retailer has suf;cient capacity to store an additional fuel blend and underground equipment is compatible,
the retailer must acquire special dispensers listed for E85.
These often cost $7,000 more than comparable E10 units.
The future of E85 is dim. Automakers have produced
FFVs to receive a credit toward fuel economy standards
compliance, but the credit will disappear in 2019. Without
some new incentive to encourage automakers to continue
producing these vehicles, the number of FFVs will drop
precipitously. A Navigant Research forecast for the Fuels
Institute projects FFV sales will drop to some 1 percent of all
vehicles by 2025.
Source: Navigant Research
Figure 2: U.S. Registered Light-Duty Vehicles, 2016