Study finds US refiners could produce higher octane E20 & E30 at modest additional cost

A new study concludes that using ethanol can be a cost-effective approach to increasing the octane rating of the US gasoline pool.

A number of studies recently have pointed out that increasing the octane rating of the US gasoline pool (currently 93 Research Octane Number (RON)) would enable higher engine efficiency for light-duty vehicles through reducing engine knock constraints, thereby enabling the design of new spark-ignition engines with higher compression ratios and boost levels.

Such a move would also have significant implications for refineries in the US refining sector, whether the higher octane was achieved via more severe refining operations, increased use of ethanol, or both.

A linear programming analysis of US refining sector by a team from MathPro Inc., Ford, GM and Chrysler has found that, by increasing the volume of ethanol, the refining sector could produce hydrocarbon blendstocks for oxygenate blending (BOBs) yielding finished E20 and E30 gasolines with higher octane ratings at modest additional refining cost (ARC): e.g., 1¢/gal for 95-RON E20 or 97-RON E30; 3–5¢/gal for 95-RON E10, 98-RON E20, or 100-RON E30; and 96-RON E10, 99-RON E20, or 101-RON E30 gasoline pools at approximately 10¢/gal.

Achieving higher octane ratings for finished gasoline incurs progressively higher investment and ARC. The price of ethanol relative to gasoline and crude oil were key determinants of the relative costs of the various finished fuels.

The study also found that reduced BOB volume (from displacement by ethanol) and lower BOB octane could (i) lower refinery CO2 emissions (e.g.,  3% for 98-RON E20,  10% for 100-RON E30) and (ii) reduce crude oil use (e.g.,  3% for 98-RON E20,  8% for 100-RON E30).

The potential for realizing higher gasoline octane ratings depends on refining techno-economics and federal and state standards on gasoline properties and composition. However, significantly higher gasoline octane ratings can be achieved by (i) increasing the octane rating of hydrocarbon gasoline to the extent feasible (e.g., to values typical 10 years ago) and (ii) increasing ethanol content from the current 10 vol % to 20?30 vol % (assuming federal regulations were modified to allow such fuels). Ethanol has a high volumetric blending octane value in gasoline: ?115?135 RON, depending on the ethanol concentration and BOB RON and composition.

Ethanol also has a high latent heat of vaporization and high sensitivity (RON minus MON), contributing to improvements in knock resistance in direct-injection and turbo-charged engines, allowing further increases in CR. Ethanol can also increase efficiency in part-load operation, regardless of engine architecture.

… this paper examines the implications for the US refining industry of increasing the octane rating and/or the ethanol content of US gasoline. It assesses the investment requirements, refining cost, and other consequences in the US refining sector of producing a national gasoline pool meeting minimum RON standards from 93.2 (the approximate current average) to 102, with ethanol concentrations from 10 to 30 vol %, both as nationwide midlevel blends (E10 to E30) and as combinations of E85 and E10. Fuel properties are estimated to enable WTW assessments of the associated GHG emissions.

The analysis used regional refinery linear programming (LP) modeling to estimate the effects on the US refining sector of producing a single future national gasoline that (i) meets a uniform minimum octane rating (RON) standard, (ii) contains ?10 ppm sulfur (the new national Tier 3 standard), and (iii) satisfies existing federal, California, and industry gasoline standards.

A refinery LP model yields an optimal value for an economic objective function. For this study, that objective function was total refining cost (the sum of direct operating costs and capital charges for new investments) incurred in producing the same slate of primary refined products with specified properties including octane rating. Results included refining economics; CO2 emissions; petroleum consumption; and BOB properties.

The cost estimates noted above incorporate both volume and octane rating effects on refining costs. Increasing the ethanol content in finished gasoline at constant octane (e.g., E10 95 RON,  E20 95 RON) reduces refining costs through two effects, the team found:

  • The required octane rating of the hydrocarbon blendstock declines, thereby reducing refining cost; and
  • the necessary volume of the gasoline BOB declines (to accommodate the additional ethanol).

Conversely, increasing the octane rating of gasoline at constant ethanol content (e.g., E20 95 RON ? E20 98 RON) increases refining costs by requiring an increase in BOB octane rating (and associated refining costs).

The team also found that average US refining costs would be about 1.6¢/gal and 1.2¢/gal (of finished gasoline) higher if ethanol was blended in combinations of E10 and E85 rather than in national E20 or E30, respectively, using the reference-case octane rating. The additional refining costs in the E10/E85 cases stem from what they called “octane give-away” in E85—i.e., E85’s octane rating is higher than that required by applicable fuel specifications.

Producing national E20 and E30 gasoline pools would require (i) changes in the regulatory framework governing ethanol use to allow such midlevel ethanol blends, (ii) sufficient additional ethanol production to support nation-wide production of these blends, (iii) changes in the distribution infrastructure to handle midlevel ethanol blends, and (iv) a vehicle fleet capable of using these fuels.

For vehicle manufacturers to optimize engine designs to use the combustion advantages of higher-RON, higher-ethanol content fuels, these fuels would have to be readily available nationwide and competitively priced with other liquid fuel alternatives, particularly during a transition to a national high-RON E20 or E30 standard. The transition would require concerted actions by multiple stakeholders, including fuel producers, fuel distributors and retailers, vehicle manufacturers, and government agencies. However, such transitions have been accomplished in the past to realize longer-term, system-wide benefits (e.g., transition to unleaded gasoline).

Understanding the implications for the refining sector is fundamental to assessing the feasibility and potential of future US gasoline with higher octane ratings and/or higher ethanol content. This study provides a techno-economic assessment of this subject to address the lack of such information in the open literature. Higher-octane (95 RON) E10 gasoline was determined to be technically feasible, without considerable additional cost, CO2 emissions, or petroleum consumption for refineries. Higher ethanol content (E20, E30) could provide a viable path to fuel with still higher octane ratings (98 RON) with reduced petroleum consumption and lower refinery CO2 emissions. Considering the significant efficiency increases demonstrated for higher-CR engines, these results suggest that further consideration (e.g., WTW life-cycle analyses) of higher-octane gasoline in the US is warranted.