Interesting Octane Article
04-18-2008, 02:58 PM
#1
Interesting Octane Article
So I was reading the Kansas City Star recently, and came upon this story. I tried copying a link but I had to search through the archives and copy and pasting a link did not work correctly. So anyways, here's the article.
Kansas City Star, The (MO)
April 13, 2008
Section: FRONT
Edition: 1
Page: A1
Before you buy gasoline, check out the octane ratings
STEVE EVERLY, The Kansas City Star
Consumers are getting confusing pricing signals at area gas stations, thanks to how retailers are handling a flood of ethanol-blended fuel.
Some area gas stations have started selling both regular and midgrade gasoline at the same price, saying there is no longer a difference between the fuels.
Other retailers, though, are still charging more for midgrade -- causing some consumers to spend more per gallon than they otherwise could.
Given that the average household buys about 1,200 gallons of gas annually, households that switch from midgrade to regular would save $120 or more per year at recent pricing spreads. The difference is worth millions annually for retailers in the Missouri-Kansas region.
The pricing discrepancy comes as ethanol-blended fuel roils longstanding assumptions about the octane ratings of gasoline, making it more dubious than ever to pay extra for super-unleaded or other midgrade gasoline.
E-10, a blend of 10 percent ethanol and gasoline that is widely used in this area, has boosted the octane rating of regular gasoline from a minimum of 87 to at least 89 -- the same as required for midgrade gasoline. But many area gas dealers are still charging more for "midgrade" fuel.
It's not as though the average consumer, already grappling with record-high gas prices, would know.
The majority of gas pumps in the Kansas City area still state that their regular has a minimum of 87 octane even though it's above 89. Meanwhile, midgrade is still posted at a minimum 89, suggesting there is a difference when compared with regular fuel.
Moreover, even if you're aware that E-10 has more octane, gas stations in Missouri and Kansas are not required by law to disclose that they're selling the fuel.
The main hint that something is afoot in a marketplace comes from the handful of stations that are selling regular and midgrade at the same price.
Hy-Vee's gas stations in Missouri are selling regular and midgrade at the same price. In Platte City, you can find a Casey's convenience store doing the same thing. And in outstate Missouri, chains such as MFA and Kum & Go also sell the two grades at the same price.
Officials at Platte-Clay Electric Cooperative, which has gas stations in Platte City and Kearney, said they rejected charging more for midgrade because it's the same fuel.
"We would probably make a few more dollars," said Bill Estes, manager of marketing and communications at the cooperative. "And it's not against the law. But it's not ethical -- I don't think."
In most parts of the Kansas City area, though, it still costs more to purchase midgrade gas than regular.
QuikTrip, the area's largest gas retailer, is charging 10 cents more per gallon for midgrade gas, even though its regular gas now exceeds the minimum midgrade octane level. At one Shell station last week, the cost for regular was $3.16 per gallon and its midgrade fuel was $3.28 per gallon.
Shell, in an e-mail response to questions, said it sold wholesale fuel that contained 10 percent ethanol for both its regular and midgrade fuels. The company noted that the gas meets the minimum of 87 octane for regular gas and 89 for midgrade. And the minimum octane levels are posted for all grades on fuel pumps, as required.
Shell, which has exited the retail end of the oil business, said pricing is left to the owners of the stations.
"Shell retailers are independent business people and set the prices of the fuel they sell to consumers," according to the e-mail.
For its part, QuikTrip said it was selling ethanol-blended fuel for its regular, midgrade and premium lines of gas. The company added that it was blending its regular and premium gas to make its midgrade, which gave it slightly more octane than regular and "more bang for the buck."
A gallon of E-10 regular has an octane rating of 89.6. Based on information provided by the company, QuikTrip's midgrade would have slightly higher octane of 90.3 if blended with premium. Its premium grade, meanwhile, has a minimum 91 octane rating.
Mike Thornbrugh, a spokesman for QuikTrip, said the company plans to continue charging 10 cents per gallon more for midgrade than regular. But he added that the company was mulling over providing more information about octane levels of each grade.
"It's something we'll probably take a look at," he said.
QuikTrip last week still had decals on its pumps that said its regular fuel had a minimum of 87 octane and its midgrade gas had 89 octane.
Octane ratings are used to indicate the fuel's ability to resist pings and knocks.
About 15 percent of drivers purchase midgrade or premium gasoline, according to the Energy Information Administration. But many experts question whether many of those purchases are necessary.
Jon Linkov, managing editor of autos for Consumer Reports magazine, said most cars perform fine with regular fuel and the average motorist wouldn't notice any difference between a 90.3 octane rating and one that was 89.6.
"In fact, unless you're tuning your car with a computer, with varied fuel/air mixtures -- think hard-core racing -- even a guy driving a high-performance car won't see a single benefit from going to 90.3 octane versus 89.6," he said.
Confused consumers
The situation, if nothing else, is sowing confusion for consumers who are beginning to notice.
David Peironnet of Gladstone noticed the same price for both regular and midgrade gas at a Hy-Vee station -- and noticed the pump stated that both had 89 octane. But when he later purchased gas at a competitor, those pumps said regular had 87 octane and midgrade had 89 octane at a higher price. Therefore, he assumed there was a difference.
"That is outright deception," he said.
Retailers, though, are following the rules as they are now defined.
The Federal Trade Commission, which sets the rules for the octane disclosure, requires only that the gas meet the minimum ratings posted on the pump. State inspectors check the fuel to ensure that the 87 minimum for regular is met, for instance, and aren't concerned if it's actually high enough to qualify as midgrade fuel.
"We don't have a problem with that," said Ron Hayes, a manager with Missouri's Weights and Measures Division.
But others, including ethanol proponents, find the lack of information frustrating since ethanol's richer octane content could save money for consumers who want some additional octane but don't have to pay more for it.
Gary Marshall, chief executive officer of the Missouri Corn Growers Association, said he has asked gas-retailer representatives why midgrade gas costs more than regular.
"I try to tell them it's the same product," he said.
Missouri has a mandatory E-10 law that took effect in January that requires gas stations in the state to sell ethanol-blended regular and midgrade gas unless its wholesale price becomes more expensive than traditional gas.
Two other states -- Hawaii and Minnesota -- currently have an E-10 mandate. And a third state -- Montana -- will enforce a mandate when it produces sufficient ethanol to supply the state.
Several other states have renewable-fuels standards that encourage the use of ethanol. Beginning in 2009, Kansas will give fuel retailers tax credits for selling E-10. But even now E-10 is widely, but not universally, available because of its lower wholesale price.
(Critics of ethanol-blended fuel note that its lower energy content diminishes mileage, which could offset the advantage of its lower price.)
In Kansas, a mixed bag of ethanol-blended and other gas also can lead to unusual pricing signals for consumers.
At a Hy-Vee station in Mission, for instance, E-10 midgrade was being sold next to regular gas that wasn't blended with ethanol. As a result, that station actually was offering midgrade gas that was a penny cheaper than regular.
It's unclear how many consumers elsewhere in the U.S. may be paying more for midgrade even though it often has the same octane as regular. About half of the gasoline now used in the United States contains ethanol -- mostly E-10 -- and that figure is expected to increase following approval of new federal legislation requiring more ethanol production.
Wholesalers in some areas, however, are supplied with lower octane gas that when blended with ethanol still produces regular fuel with an 87 octane rating. Hayes, of Missouri's Weights and Measures Division, said that's the case in St. Louis.
Midgrade and premium gas have long been a profitable niche in the fuel retailing business because of the larger profit margins.
In 2006, Missouri and Kansas motorists bought about 198.9 million gallons of midgrade gas, according to the EIA. Assuming those motorists shifted to regular at current prevailing pricing spreads, they could save millions of dollars a year.
In the last several months, demand for midgrade has actually climbed. But that is thought to be largely because of those consumers who are able to purchase midgrade fuel at growing numbers of stations offering midgrade for the same price as regular.
Paying extra for midgrade fuel has long been considered a questionable value even when it had higher octane than regular fuel.
Motorists in the U.S. spend millions of dollars each year on higher-octane fuels they don't need, according to the FTC. Although octane helps prevent engine pings and knocks, higher octane is only needed in a small percentage of vehicles.
Some think the higher grades are better at cleaning the engine. But the Environmental Protection Agency requires detergents in all gas. The EPA requirements have been criticized as too low, and several automakers established a new standard for all grades, including regular. Gas brands that have met those requirements can be found at toptiergas.com.
Linkov, of Consumer Reports, said automakers require premium fuel, which has a 91 octane rating, for a relatively few models that have high-compression engines. Even consumers that have vehicles that "recommend" premium can probably do without it. The grade of fuel needed for a vehicle is stated in the owner's manual.
For most cars, regular gas, even with an 87 octane rating, should do fine. All of this suggests that paying extra for midgrade, especially when it has the same octane, is a mistake.
"You can save yourself 10 cents a gallon," Linkov said.
Midgrade woes
Volume of regular, midgrade and premium gas sold in 2006 (gallons per day)
Missouri
Kansas
Regular
7,419,000
3,385,000
Midgrade
348,200
197,000
Premium
460,000
198,700
$120 Annual cost for average household if purchasing midgrade gas that is 10 cents per gallon more than regular
Octane primer: What to know before you buy gasoline
Q: What are octane ratings?
A: Octane ratings measure a gasoline's ability to resist engine knock, a rattling or pinging sound that results from premature ignition of the compressed fuel-air mixture in one or more cylinders.
Q: What's the right octane?
A: Check your owner's manual to determine the right octane level for your car. Regular octane is recommended for most cars.
Q: Does it help to use a higher octane than recommended?
A: That can be a costly mistake, especially during times of high fuel prices. Octane grades don't represent a "good, better, best" choice; they simply measure the resistance of fuel to knocking or pinging, a condition in which gasoline burns uncontrollably in the engine's combustion chambers. Knocking and pinging can damage an engine. While high-octane formulations resist knocking better than lower octanes, most engines are designed to take regular gas, which has an octane rating of about 87. Engines requiring premium gas are typically the more powerful ones found in sports and luxury vehicles. Those engines use a very high compression ratio, making them more vulnerable to knocking, so recommended fuels have octane ratings of 91 or higher.
Q: Does high-octane gasoline increase power?
A: If your car is designed to run on 87 octane gasoline, you shouldn't notice any more power on high-octane gasoline.
Q: Will higher-octane gasoline clean your engine better?
A: As a rule, high-octane gasoline does not outperform regular octane in preventing engine deposits from forming, in removing them, or in cleaning your car's engine.
Copyright (c) 2008 The Kansas City Star
So, what are everyone's thoughts?
Kansas City Star, The (MO)
April 13, 2008
Section: FRONT
Edition: 1
Page: A1
Before you buy gasoline, check out the octane ratings
STEVE EVERLY, The Kansas City Star
Consumers are getting confusing pricing signals at area gas stations, thanks to how retailers are handling a flood of ethanol-blended fuel.
Some area gas stations have started selling both regular and midgrade gasoline at the same price, saying there is no longer a difference between the fuels.
Other retailers, though, are still charging more for midgrade -- causing some consumers to spend more per gallon than they otherwise could.
Given that the average household buys about 1,200 gallons of gas annually, households that switch from midgrade to regular would save $120 or more per year at recent pricing spreads. The difference is worth millions annually for retailers in the Missouri-Kansas region.
The pricing discrepancy comes as ethanol-blended fuel roils longstanding assumptions about the octane ratings of gasoline, making it more dubious than ever to pay extra for super-unleaded or other midgrade gasoline.
E-10, a blend of 10 percent ethanol and gasoline that is widely used in this area, has boosted the octane rating of regular gasoline from a minimum of 87 to at least 89 -- the same as required for midgrade gasoline. But many area gas dealers are still charging more for "midgrade" fuel.
It's not as though the average consumer, already grappling with record-high gas prices, would know.
The majority of gas pumps in the Kansas City area still state that their regular has a minimum of 87 octane even though it's above 89. Meanwhile, midgrade is still posted at a minimum 89, suggesting there is a difference when compared with regular fuel.
Moreover, even if you're aware that E-10 has more octane, gas stations in Missouri and Kansas are not required by law to disclose that they're selling the fuel.
The main hint that something is afoot in a marketplace comes from the handful of stations that are selling regular and midgrade at the same price.
Hy-Vee's gas stations in Missouri are selling regular and midgrade at the same price. In Platte City, you can find a Casey's convenience store doing the same thing. And in outstate Missouri, chains such as MFA and Kum & Go also sell the two grades at the same price.
Officials at Platte-Clay Electric Cooperative, which has gas stations in Platte City and Kearney, said they rejected charging more for midgrade because it's the same fuel.
"We would probably make a few more dollars," said Bill Estes, manager of marketing and communications at the cooperative. "And it's not against the law. But it's not ethical -- I don't think."
In most parts of the Kansas City area, though, it still costs more to purchase midgrade gas than regular.
QuikTrip, the area's largest gas retailer, is charging 10 cents more per gallon for midgrade gas, even though its regular gas now exceeds the minimum midgrade octane level. At one Shell station last week, the cost for regular was $3.16 per gallon and its midgrade fuel was $3.28 per gallon.
Shell, in an e-mail response to questions, said it sold wholesale fuel that contained 10 percent ethanol for both its regular and midgrade fuels. The company noted that the gas meets the minimum of 87 octane for regular gas and 89 for midgrade. And the minimum octane levels are posted for all grades on fuel pumps, as required.
Shell, which has exited the retail end of the oil business, said pricing is left to the owners of the stations.
"Shell retailers are independent business people and set the prices of the fuel they sell to consumers," according to the e-mail.
For its part, QuikTrip said it was selling ethanol-blended fuel for its regular, midgrade and premium lines of gas. The company added that it was blending its regular and premium gas to make its midgrade, which gave it slightly more octane than regular and "more bang for the buck."
A gallon of E-10 regular has an octane rating of 89.6. Based on information provided by the company, QuikTrip's midgrade would have slightly higher octane of 90.3 if blended with premium. Its premium grade, meanwhile, has a minimum 91 octane rating.
Mike Thornbrugh, a spokesman for QuikTrip, said the company plans to continue charging 10 cents per gallon more for midgrade than regular. But he added that the company was mulling over providing more information about octane levels of each grade.
"It's something we'll probably take a look at," he said.
QuikTrip last week still had decals on its pumps that said its regular fuel had a minimum of 87 octane and its midgrade gas had 89 octane.
Octane ratings are used to indicate the fuel's ability to resist pings and knocks.
About 15 percent of drivers purchase midgrade or premium gasoline, according to the Energy Information Administration. But many experts question whether many of those purchases are necessary.
Jon Linkov, managing editor of autos for Consumer Reports magazine, said most cars perform fine with regular fuel and the average motorist wouldn't notice any difference between a 90.3 octane rating and one that was 89.6.
"In fact, unless you're tuning your car with a computer, with varied fuel/air mixtures -- think hard-core racing -- even a guy driving a high-performance car won't see a single benefit from going to 90.3 octane versus 89.6," he said.
Confused consumers
The situation, if nothing else, is sowing confusion for consumers who are beginning to notice.
David Peironnet of Gladstone noticed the same price for both regular and midgrade gas at a Hy-Vee station -- and noticed the pump stated that both had 89 octane. But when he later purchased gas at a competitor, those pumps said regular had 87 octane and midgrade had 89 octane at a higher price. Therefore, he assumed there was a difference.
"That is outright deception," he said.
Retailers, though, are following the rules as they are now defined.
The Federal Trade Commission, which sets the rules for the octane disclosure, requires only that the gas meet the minimum ratings posted on the pump. State inspectors check the fuel to ensure that the 87 minimum for regular is met, for instance, and aren't concerned if it's actually high enough to qualify as midgrade fuel.
"We don't have a problem with that," said Ron Hayes, a manager with Missouri's Weights and Measures Division.
But others, including ethanol proponents, find the lack of information frustrating since ethanol's richer octane content could save money for consumers who want some additional octane but don't have to pay more for it.
Gary Marshall, chief executive officer of the Missouri Corn Growers Association, said he has asked gas-retailer representatives why midgrade gas costs more than regular.
"I try to tell them it's the same product," he said.
Missouri has a mandatory E-10 law that took effect in January that requires gas stations in the state to sell ethanol-blended regular and midgrade gas unless its wholesale price becomes more expensive than traditional gas.
Two other states -- Hawaii and Minnesota -- currently have an E-10 mandate. And a third state -- Montana -- will enforce a mandate when it produces sufficient ethanol to supply the state.
Several other states have renewable-fuels standards that encourage the use of ethanol. Beginning in 2009, Kansas will give fuel retailers tax credits for selling E-10. But even now E-10 is widely, but not universally, available because of its lower wholesale price.
(Critics of ethanol-blended fuel note that its lower energy content diminishes mileage, which could offset the advantage of its lower price.)
In Kansas, a mixed bag of ethanol-blended and other gas also can lead to unusual pricing signals for consumers.
At a Hy-Vee station in Mission, for instance, E-10 midgrade was being sold next to regular gas that wasn't blended with ethanol. As a result, that station actually was offering midgrade gas that was a penny cheaper than regular.
It's unclear how many consumers elsewhere in the U.S. may be paying more for midgrade even though it often has the same octane as regular. About half of the gasoline now used in the United States contains ethanol -- mostly E-10 -- and that figure is expected to increase following approval of new federal legislation requiring more ethanol production.
Wholesalers in some areas, however, are supplied with lower octane gas that when blended with ethanol still produces regular fuel with an 87 octane rating. Hayes, of Missouri's Weights and Measures Division, said that's the case in St. Louis.
Midgrade and premium gas have long been a profitable niche in the fuel retailing business because of the larger profit margins.
In 2006, Missouri and Kansas motorists bought about 198.9 million gallons of midgrade gas, according to the EIA. Assuming those motorists shifted to regular at current prevailing pricing spreads, they could save millions of dollars a year.
In the last several months, demand for midgrade has actually climbed. But that is thought to be largely because of those consumers who are able to purchase midgrade fuel at growing numbers of stations offering midgrade for the same price as regular.
Paying extra for midgrade fuel has long been considered a questionable value even when it had higher octane than regular fuel.
Motorists in the U.S. spend millions of dollars each year on higher-octane fuels they don't need, according to the FTC. Although octane helps prevent engine pings and knocks, higher octane is only needed in a small percentage of vehicles.
Some think the higher grades are better at cleaning the engine. But the Environmental Protection Agency requires detergents in all gas. The EPA requirements have been criticized as too low, and several automakers established a new standard for all grades, including regular. Gas brands that have met those requirements can be found at toptiergas.com.
Linkov, of Consumer Reports, said automakers require premium fuel, which has a 91 octane rating, for a relatively few models that have high-compression engines. Even consumers that have vehicles that "recommend" premium can probably do without it. The grade of fuel needed for a vehicle is stated in the owner's manual.
For most cars, regular gas, even with an 87 octane rating, should do fine. All of this suggests that paying extra for midgrade, especially when it has the same octane, is a mistake.
"You can save yourself 10 cents a gallon," Linkov said.
Midgrade woes
Volume of regular, midgrade and premium gas sold in 2006 (gallons per day)
Missouri
Kansas
Regular
7,419,000
3,385,000
Midgrade
348,200
197,000
Premium
460,000
198,700
$120 Annual cost for average household if purchasing midgrade gas that is 10 cents per gallon more than regular
Octane primer: What to know before you buy gasoline
Q: What are octane ratings?
A: Octane ratings measure a gasoline's ability to resist engine knock, a rattling or pinging sound that results from premature ignition of the compressed fuel-air mixture in one or more cylinders.
Q: What's the right octane?
A: Check your owner's manual to determine the right octane level for your car. Regular octane is recommended for most cars.
Q: Does it help to use a higher octane than recommended?
A: That can be a costly mistake, especially during times of high fuel prices. Octane grades don't represent a "good, better, best" choice; they simply measure the resistance of fuel to knocking or pinging, a condition in which gasoline burns uncontrollably in the engine's combustion chambers. Knocking and pinging can damage an engine. While high-octane formulations resist knocking better than lower octanes, most engines are designed to take regular gas, which has an octane rating of about 87. Engines requiring premium gas are typically the more powerful ones found in sports and luxury vehicles. Those engines use a very high compression ratio, making them more vulnerable to knocking, so recommended fuels have octane ratings of 91 or higher.
Q: Does high-octane gasoline increase power?
A: If your car is designed to run on 87 octane gasoline, you shouldn't notice any more power on high-octane gasoline.
Q: Will higher-octane gasoline clean your engine better?
A: As a rule, high-octane gasoline does not outperform regular octane in preventing engine deposits from forming, in removing them, or in cleaning your car's engine.
Copyright (c) 2008 The Kansas City Star
So, what are everyone's thoughts?
04-19-2008, 07:32 PM
#3
Senior Member
Join Date: Jun 2003
Location: Colorado Springs, Colorado
Posts: 1,994
There are too many points that need clarification in this article. But a big point that the article misses -- most gasoline refined to be blended with 10% ethanol is refined to take advantage of the 2 octane number boost that 10% ethanol provides. So regular gasoline is refined as 85 octane and when blended with 10% ethnol provides 87 octane.
In most locations mid-grade is a blend (into the tank truck) of regular and premium. There are few locations where a separate terminal tank of mid-grade gasoline exists. There are separate mid-grade tanks at most gas stations, but that is the only place.
There are many places in Iowa and Nebraska where the cheapest grade of gasoline is mid-grade made by putting 10% ethanol into 87 octane regular. Stations in those markets use this mid-grade as their "fighting grade" and advertise its price to bring people into the stations.
If anyone has a question about any point in this long article, just ask and I will try to answer it. But remember that many points in this article apply to the Kansas City area.
In most locations mid-grade is a blend (into the tank truck) of regular and premium. There are few locations where a separate terminal tank of mid-grade gasoline exists. There are separate mid-grade tanks at most gas stations, but that is the only place.
There are many places in Iowa and Nebraska where the cheapest grade of gasoline is mid-grade made by putting 10% ethanol into 87 octane regular. Stations in those markets use this mid-grade as their "fighting grade" and advertise its price to bring people into the stations.
If anyone has a question about any point in this long article, just ask and I will try to answer it. But remember that many points in this article apply to the Kansas City area.
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