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Some Long-Run Effects of Growing Markets and Renewable Fuel Standards on Additives Markets and the U.S. Ethanol Industry

  • Gallagher, Paul W.
  • Shapouri, Hosein
  • Price, Jeffrey
  • Schamel, Guenter
  • Brubaker, Heather
Registered author(s):

    The effects of likely regulatory and policy changes in the US gasoline and additives market are compared to a reference baseline. The baseline reflects existing EPA policies about fuel quality regulation and likely petroleum and gasoline expansions. The market and welfare effects are presented for implementing a renewable fuel standard; imposing a national ban on the additive MTBE; and removing the oxygen standard for reformulated fuel. Market and welfare estimates are based on adjusting product market demands and factor supplies. Product market and price analyses include quality-differentiated products, such as refinery gasoline, chemical additives and ethanol at the wholesale level; and gasoline grades in conventional, reformulated and oxygenated markets at the retail level. Factor market analyses include supplies for petroleum, natural gas byproducts, and corn. The analysis includes the welfare cost of fuel to consumers and income in agriculture and the petroleum sector.

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    Paper provided by Iowa State University, Department of Economics in its series Staff General Research Papers with number 10648.

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    Date of creation: 01 Sep 2003
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    Publication status: Published in Journal of Policy Modeling, September 2003, vol. 25, pp. 585-608
    Handle: RePEc:isu:genres:10648
    Contact details of provider: Postal: Iowa State University, Dept. of Economics, 260 Heady Hall, Ames, IA 50011-1070
    Phone: +1 515.294.6741
    Fax: +1 515.294.0221
    Web page: http://www.econ.iastate.edu
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