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What Contributes to Ethanol Cost?

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  • Written By: Summer Banks
  • Edited By: Michelle Arevalo
  • Last Modified Date: 11 September 2016
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Ethanol cost can be established by breaking down the products and services used to manufacture this alternative fuel. In most cases, the creation of fuel grade ethanol requires a starch source, manufacturing facility, and additives to convert the starch to sugar and remove water from the ethanol. Other contributors to ethanol costs may include fuel transportation and maintenance of the ethanol producing facility.

The most common starch source used for the production of ethanol is corn. Corn can be grown for the sole purpose of producing ethanol or for both ethanol and human consumption. There is no difference between ethanol grade corn and the corn approved for use as a food source. Ethanol cost will vary based on the current market price of corn, or whatever other form of starch is used to produce ethanol fuel.

Manufacturing facilities are required to convert the starch, from corn or another source, to ethanol. These facilities can be equipped with distilleries, fermentation vats, and vats used for mixing. The desired output of such a biorefinery may affect the size of the equipment used to manufacture ethanol. These factors must be considered when determining the ethanol cost.

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In order to convert the starches used to produce ethanol into pure alcohol, enzymes and additives are needed. As of 2005, one of the newest enzymes used to convert corn starch to sugar was alpha-amylase enzyme. Other additives needed may include microorganisms to convert the sugar to alcohol as well as absorbent materials to remove water from the ethanol at the end of production. All of these materials may contribute to overall ethanol cost.

Once the ethanol has been manufactured, the biofuel may need to be moved to a storage facility or a facility used to mix the ethanol with traditional gasoline. Many cities require fuel to be mixed at a 10% ethanol to 90% gasoline ratio in order to reduce the greenhouse gases emitted from the automobiles using this fuel. The ethanol can also be mixed at a ratio of 85% ethanol to 15% gasoline, resulting in what is also termed E85 ethanol. Transportation expenses may also alter the cost of the ethanol.

Production of ethanol also requires maintenance of the biorefinery. Employees will often work to produce the ethanol and keep the biorefinery working at full capacity. Maintenance of machines used in each stage of the ethanol production may need systematic cleaning, repairing, and updating in order to continue functioning in a safe and effective manner. The cost of such upkeep and salaries may also be added to the ethanol cost.

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