E85 Boondoggle of the Day: $5.5 Million DOE Grants for the SOS

Now that the Department of Energy (DOE) has doled out some $25 billion to help automakers retool taxpayers—I mean, retrofit factories to build incrementally more fuel efficient vehicles than the ones built at the same locations previously—the agency is continuing its cash for anything environmental program. Our old friend E85 is the beneficiary of a $5.5 million handout as part of the American Recovery and Reinvestment Act. The money goes towards two noble goals sure to get the American economy on its feed—I mean feet. First up: “outreach.” Which is Fed-speak for pro-industry propaganda, presumably . . .

This topic area is aimed at increasing public awareness through national campaigns to inform the public on the benefits, safety and use requirements of higher ethanol blends up to E85. Projects that include materials as part of a dispenser display showing fuel energy content, mileage impact, costs per mile and greenhouse gas reductions are encouraged.

DOE has dedicated $2 million to this topic area and anticipates making five individual awards between $250,000 and $1 million per project. There is no cost-sharing requirements for this topic area.

Good luck spinning that lot. Second, “infrastructure.”

This topic area will fund projects that expand the infrastructure at retail fuel locations to accommodate ethanol blends up to E85. Individual projects may include modifications, upgrades or expansion of existing infrastructure at retail gas stations or the creation of new infrastructure to accommodate higher ethanol blends. Relevant infrastructure includes dispensing equipment, storage tanks and systems for tracking the amount of ethanol dispensed.

DOE has dedicated $3.5 million to this topic area and hopes to fund up to 30 individual projects with awards of $50,000 to $200,000 per project. Applicants must provide 50% cost share.

This type of subsidy isn’t doing squat for the E85 industry. Bottom line: even with a 50 percent reduction in the cost of installing the corn juice pumps, not enough people want the fuel to recoup the cash. What does that tell you?