Ethanol and Reducing Foreign Oil Dependency

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Besides economic and environmental advantages, ethanol has helped America lessen its dependency on foreign oil. In fact, increased production of renewable fuels such as ethanol were key components of the Energy Independence and Security Act (EISA) of 2007.

The act, which was passed by Congress and signed into law by President George W. Bush, clearly saw the potential for clean renewable fuels like ethanol to increase America’s energy security.

From 2005 (when the Renewable Fuels Act was passed) to 2013, ethanol production has steadily increased. In 2005, ethanol production was 0.25 million barrels a day (b/d). In 2019, it was at 1.1 million b/d.

Ethanol supply in motor gasoline has risen in tandem. In 2005, it comprised 2.8 percent of total gasoline consumption. Since 2017, it has been at 10 percent. In some states such as Minnesota, which has the most number of E85 fueling stations, it was at 12.49 percent in 2017.

In recent years, domestic production of crude oil has jumped due to the shale oil boom. However, there is still a lot of misconception on what this means in terms of petroleum imports.

According to the EIA, in 2018, America's petroleum production averaged 17.73 million b/d while petroleum imports was at 9.94 million b/d and petroleum exports was at 7.6 million b/d. Average domestic petroleum consumption in America in 2019 was 20.5 million b/d.

Part of the reason America still imports petroleum products is because much of the shale crude oil produced is light while many refineries in the country were designed for heavy crude oil. As such, despite surging production, America still relies on foreign energy.