Is ethanol-blended gasoline more costly than petroleum gasoline?
No! Ethanol-blended gasoline is generally available to marketers at a lower cost than petroleum gasoline (petro-gas) of the same octane. After the federal and provincial ethanol tax credit is applied, the cost of ethanol to marketers is about the same as Regular Unleaded gasoline and often less. Ethanol is relatively inexpensive to blenders and can increase the octane value of gasoline considerably. Octane is a measure of gasoline’s resistance to burn prematurely under high compression causing an engine to “knock” or “ping” under load. For many years gasoline quality, and therefore its price, has been expressed in terms of its octane or “anti knock” rating. “The higher the octane the higher the price.” In some markets ethanol is found only in high octane (higher priced) gasoline. This made some people think ethanol blends were more expensive. In most markets the standard grade of gasoline “regular unleaded” has an octane rating of 87. Mid-grade gasoline sometimes called “Unleaded Plus”
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