Team Ethanol driver Jeff Simmons practices at the Indianapolis Motor Speedway. This year, Indy 500 racers will drive cars that run on an ethanol-blended fuel.
By Roland Jones Business news editor
msnbc.com
updated 5/28/2006 3:45:02 PM ET 2006-05-28T19:45:02

Speed is of the essence as drivers race around the oval at Sunday’s 90th running of the Indianapolis 500, but it is not just the drivers hoping to win big.

For the first time in the race’s 95-year history, cars in the Indy 500 are burning a fuel that is 10 percent ethanol and 90 percent methanol. It’s a fuel change that some in the ethanol industry hope will hasten the adoption of the alternative fuel among ordinary drivers.

Three big names in the ethanol industry are driving the fuel switch — ICM Inc.,  Broin Cos. and Fagen Inc. The companies, which engineer and build ethanol plants, have put up several million dollars as the prime sponsors of the No. 17 Team Ethanol Honda/Panoz/Firestone car driven by Jeff Simmons in the race at Indianapolis Motor Speedway. Simmons replaces Paul Dana, who died in a practice accident March 26.

The aim is to promote the power, fuel-efficiency and safety of ethanol in front of the estimated 300 million people who will view the race, said Tom Slunecka, executive director of the Ethanol Promotion and Information Council, which represents the three ethanol companies.

“When we conducted national research we found that many consumers are still concerned about ethanol’s performance,” said Slunecka. “In the 1980s, ethanol had some distribution problems, and it seems concerns about those problems have carried over to today, so we wanted to show those issues have been resolved. And getting involved in Indy racing is the best way to show it.”

The Indy Racing League said this year that its Indy Car series would switch from pure methanol — a fuel derived from natural gas that replaced gasoline in the 1970s because it is less likely to ignite — to the new 90-10 blend of methanol and corn-derived ethanol. In 2007, the league plans to switch permanently to 100 percent ethanol.

It’s a small market, but a highly visible one. Some 160,000 gallons will be used in the 14 Indy car races on this year's circuit — a drop in the 4.6 billion-gallon ocean of annual production. But backers of the Indy ethanol drive see its inclusion as a big symbolic gesture meant to counter perceptions that ethanol does not perform as well as other fuels.

“We could have put our name on the side of a car to promote ethanol, but instead we did it the hard way, so we arranged this fuel switch," said Slunecka. "It’s not marketing hype -- it’s true performance, and the IRL would never have agreed to this change if it lessened the performance of the vehicles in their races. We had to prove that these cars would perform just as well, and they’re already setting new records burning ethanol.”

Cars running on ethanol certainly pack a powerful punch. Pure ethanol — made from renewable  plant sources like corn, wheat and sugarcane — has an octane rating of 113, compared with 107 for methanol and about 91 to 95 for gasoline. Several track records already have been set this season using the new fuel blend. In general the higher a fuel’s octane rating, the better the engine will perform.

The most common use of ethanol by American drivers is in E85 — a mixture of gasoline and ethanol with up to 85 percent ethanol by volume. E85, which is widely used in Brazil and Sweden, can be used in engines modified to accept higher concentrations of ethanol, which is corrosive and can damage ordinary engines.

Methanol producers are naturally disappointed by the Indy fuel switch, said Gregory Dolan, vice president of communications and policy for the Methanol Institute. Methanol will be used in some other races, although cars that run in NASCAR, the nation's most popular series, use gasoline.

“I think they’ll find, switching to ethanol, their fuel costs will be rising, and they may find some period of adjustment as they try to transition their high-performance vehicles from one alcohol fuel to the other,” Dolan said. “This probably has more to do with the politics of corn than it does with the actual need for high-performance racing fuel.”

Slunecka says he does not expect any problems when Indy switches to pure ethanol in 2007. In fact, because ethanol generates more power than methanol, cars in the race will see their fuel efficiency rise by as much as 30 percent next year when they switch, he said.

“This is also going to decrease the amount of fuel a car needs, so the weight of the cars will be reduced and they’ll be able to increase their speed,” he said. “From a safety perspective, if there’s an accident there’ll be less fuel to burn. And unlike methanol, which is difficult to see when it’s burning, ethanol gives off more color and smoke when it burns, so if there is an accident it will be much easier for people to see it."

Indy racing officials also are promoting a homegrown fuel, as ethanol is chiefly made from corn grown in Midwestern states led by Illinois, Indiana, Iowa and Kansas. The industry is growing, with 83 ethanol plants operating and 14 under construction.

“In the last 10 years, motorsports has really broken into the mainstream in helping promote and publicize sponsors’ products — it’s not just motor oil anymore,” said Ken Ungar, senior vice president of public affairs for the Indy Racing League. “It’s about a broad range of consumer products. The ethanol industry, as many other industries have, recognizes that motorsports is a powerful promotion tool."

There are environmental advantages too. Ethanol burns more cleanly than gasoline or methanol, reducing emissions of carbon monoxide and particulate matter that can contribute to the greenhouse effect.

But not everyone is as excited about ethanol, which is doing little if anything to reduce fuel costs, currently above $3 a gallon in much of the nation.

“It’s getting a big push now because there’s tight supply, but I think we have the cart before horse,” said Terry McInturff, director of the Center for Energy Commerce at Texas Tech University's Rawls College of Business.

“[Ethanol] has some good features. It's less of a pollutant than gas, but the mileage is not as good and we have serious problems to work out," he said. "Ethanol is not pipeline-friendly, as it can be easily contaminated with water, and if we want to replace gasoline with it, we’d need to use 87 percent of our farmland, so it has practical limits. In the end I’d say ethanol has its niche, but it has lots of problems that politicians tend to gloss over."

Slunecka is more optimistic.

“There’s always going to be some question about this. After all, we produce 4.6 billion gallons annually, compared with the 130 billion gallons of gasoline Americans use each year,” said Slunecka. “But we have increased production by 20 percent annually for the last few years, so changes are coming about, and at a certain point Americans who want a better environment and want to reduce our dependence on foreign oil need to stand up; you need to stand up as a consumer and say you are making a difference.”

While the Indy 500 is switching to ethanol, there’s no word yet on whether the far bigger NASCAR — which is just now transitioning from leaded to unleaded gasoline — has any plans to consider ethanol use.

Discussions with NASCAR have started “on a low level,” said Slunecka. “We would love to work with NASCAR,” he said. “They are using leaded fuel now and that’s nasty stuff vs. any other fuel. We think they have a perfect opportunity to move to a blend of ethanol in 2007.”

The Associated Press contributed to this report.

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