This would amount to about 9.3 percent of projected gasoline consumption in the year 2000 and about 9 percent in 2010. The vast majority of USDA’s biofuels research program is focused on developing corn starch as a feedstock for ethanol and, to a lesser extent, research to produce biodiesel from farm crops. EPA also estimated the cost of RFG phase II in removing NOx at about $3,700 per ton and the cost of removing air toxics at about $40,000 per ton for RFG phase I.
EPA has recognized the limitations of the cost-effectiveness information for RFG and specifically the need for additional information that compares the costs of the RFG program with other control measures. RFG is ranked fourth out of the 14 mobile source control measures. This appendix provides additional information on the agencies’ efforts. The appendix also shows the processes for converting corn and biomass to ethanol. Figure V.2 illustrates the process used to convert biomass feedstocks into ethanol. GAO’s Comments

1. 4. 6. 7. 8. Comments From the Department of Agriculture

The following are GAO’s comments on the Department of Agriculture’s letter dated May 16, 1996. 5. 6. 7. Objectives, Scope, and Methodology

The objectives of our review were to (1) summarize the results of federal and other studies on the cost-effectiveness of using RFG compared to other automotive emission control measures and compare estimates of the price of RFG used in such studies with more recent actual experience; (2) summarize the results of studies estimating the potential for oxygenates to reduce the use of petroleum; and (3) summarize the ongoing federal research into biofuels, including any related past or projected cost reduction goals, and any increased demand estimates based on such goals.
Why GAO Did This Study

Pursuant to a congressional request, GAO provided information on the cost-effectiveness of reformulated gasoline (RFG), focusing on: (1) the potential for oxygenates to reduce petroleum use; and (2) ongoing federal biofuel research.

What GAO Found

GAO found that: (1) RFG is more cost-effective than some automotive emission control measures; (2) the extent and nature of air pollution in any specific area determines whether certain pollution control measures are used individually or in combination with other control measures; (3) about 305,000 barrels of petroleum per day are at risk for displacement by the year 2000; (4) this displacement amounts to nearly 3.7 percent of the estimated gasoline consumption for year 2000 and 3.6 percent for 2010; (5) the Department of Energy is focusing its efforts on reducing the cost of growing and converting biomass feedstocks into ethanol, and the Department of Agriculture is focusing on reducing the cost of growing and converting agricultural feedstock into ethanol; (6) advances in biofuels research has reduced the cost of producing ethanol from biomass crops; (7) further cost reductions in producing corn-based ethanol, and the subsequent demand for it, may be constrained by the price of corn and its many uses; and (8) the demand for ethanol will increase assuming the successful development and commercialization of biofuels technology.