The Economic Competitiveness of Methanol as a Motor Fuel

With some relatively minor modifications to fuel systems and engines, methanol can be used satisfactorily as a replacement for gasoline in conventional automobiles. A major drawback associated with its use as a motor fuel is its low heat of combustion, about one-half that of gasoline, which adds considerably to the cost of its distribution and transportation, hence to its selling price at the gas pump. To compete with gasoline, the price of methanol at the plant, in dollars per million Btu, would have to be substantially below the plant price of gasoline. This Note defines the plant price conditions under which methanol could compete with gasoline. At certain combinations of plant prices for the two fuels, a preferred strategy would be to use methanol as an intermediate chemical and convert it into gasoline before distribution rather than to use it directly as an automotive fuel.