Study by Governors' Ethanol Coalition Finds Ethanol Production
Can Meet Nation's Needs

SAN FRANCISCO, CA - The 24-member Governors' Ethanol Coalition today released a study of current and future ethanol production capacity confirming the ability of the industry to meet the nation's gasoline oxygen additive needs if MTBE is removed from gasoline. The study estimated the ethanol industry could produce 3.5 billion gallons a year by 2004.

"The nation's 58 ethanol plants in 19 states are well-prepared to meet the nation's immediate needs for an oxygen replacement to MTBE in gasoline," said Iowa Governor and Coalition Chair Tom Vilsack. "The latest information indicates an estimated 1.1 billion gallons more ethanol a year could be available shortly."

According to the study, six new plants in five states will begin production shortly. Twenty more grain-to-ethanol plants in 16 states - including Montana, New Jersey, Oregon, Texas and Washington - are being planned. An additional 12 plants using various organic wastes such as sweet potatoes, rice straw and wood and forest waste in seven states - including Pennsylvania, California, North Carolina and New York -- are also in the planning stages.

Last month, EPA Administrator Carol Browner asked Governor Vilsack and Nebraska Governor and Coalition Vice Chair Mike Johanns to verify the nation's ethanol production capability. "All of us are very concerned about minimizing disruptions and price volatility to the nation's gasoline supplies as MTBE is eliminated," Governor Vilsack said.

In his remarks at the National Conference on Ethanol Policy and Marketing in San Francisco, Governor Vilsack said the study demonstrates the impact a domestic ethanol industry can have throughout the nation. "When ethanol production reaches 3.5 billion gallons annually," Vilsack said, "47,800 new jobs will have been created, many in areas where job creation is difficult." According to the study non-ethanol production industries will benefit: 2,300 new jobs in transportation, 1,300 new jobs in construction, 3,200 new jobs in retail and 11,000 new jobs in service industries. "These more than 47,000 jobs scattered across the nation will more than replace the 25,000 jobs being lost by the MTBE industry in Texas," Vilsack said.

The full text of the study, Ability of the U.S. Ethanol Industry to Replace MTBE, can be found at the Coalition's web site: www.ethanol-gec.org/ability.html .

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