California Report Documents Benefits of In-state Ethanol Industry

A report completed earlier this year by the California Energy Commission concludes, "California is poised to become a large and growing market for ethanol as a replacement for the gasoline additive MTBE." In addition to environmental benefits, the report, Costs and Benefits of a Biomass-to-Ethanol Production Industry in California , notes that in-state ethanol production could provide more than $1 billion in economic benefits to the state.

The report notes opportunities exist in the state for both grain and cellulose ethanol production. According to the report, by 2005 California could produce 100 million gallons of ethanol annually from cellulose, including rice straw and forestry waste, and 400 million gallons per year by 2010. The report notes that ethanol production from rice straw will provide rice growers with an important environmental alternative to burning. The use of forestry waste will help reduce the frequency and intensity of forest fires. Importantly, curtailed burning and fires will reduce air pollutant emissions.

Finally, the report states that ethanol production in the state could help to constrain consumer gasoline prices. The report was completed at the request of the California Legislature as part of its evaluation of options to MTBE use.