Methanol: Key to US Energy Security

The US has been rigorously impacted by rapid increase in gasoline prices over the last couple of years. Despite continuous efforts on developing alternative energy sources by the US government, it is still heavily dependent on gasoline for its energy requirements. The main rationale for high gasoline dependence is availability of fewer choices for gasoline blend such as MTBE, ethanol and methanol. By mid of 2000, US banned the use of MTBE as gasoline additive due to environmental and health concerns. This led to a rapid growth in the ethanol demand in fuel blend application which also enjoyed political favoritism in terms of subsidy on corn. In the recent past, ethanol prices witnessed an upward trend owing to uncertainty over corn availability and its prices in the US. In addition to that, the use of corn for ethanol production also boosted debate on food vs. fuel and led to a rise in concern over food security across the US. These series of events opened a window of opportunity for methanol, an alternative source of energy, produced from natural gas which is currently at lowest price level in the US. Methanol provides promising opportunities as transportation fuel and poses huge potential to replace gasoline entirely in the longer run. China is a leader in the methanol fuel market, who have efficaciously tested methanol as substitute fuel in the transportation sector whereas US is still mired in oil. Along with pondering over methanol as transportation fuel for future, US has simultaneously been working on various programs for improving fuel efficiency for light-duty cars and trucks which is expected to double the average fuel efficiency to reach around 54.5 miles per gallon by 2025 and will save USD 8,200 per vehicle with substantial decline in greenhouse gas emissions. Though the change does not seem that easy as there is no silver bullet, it will be interesting to see how US government is going to act in this situation to opt for a sustainable approach which may include use of wide array of energy resources. However, any progress in this direction will lead to reducing US dependency on gasoline and would pay dividend in the future.