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OED > Bio & Alternative Fuels > Biofuels Biofuels

Biofuels are renewable, domestically produced fuels that can be blended with gasoline can run automobile engines. Biofuels are made either from plants or animal products, and the two major types of biofuels used for transportation are biodiesel and ethanol. Both biodiesel and ethanol reduced the amount of gasoline needed per mile driven.

Biodiesel can be used in any standard diesel engine and does not require engine modification. Biodiesel can be used by itself or blended with gasoline in varying concentrations. B100 is pure biodiesel, but B20 (20% biodiesel, 80% petroleum diesel) and B5 (5% biodiesel, 95% petroleum diesel) are common blends. Biodiesel and biodiesel blends are used by diesel engines and burn more cleanly than petrodiesel.

Ethanol used in the US is made primarily from the starch in corn grain. Ethanol is regularly blended with gasoline at low levels, but some gas stations offer E85 (85% ethanol, 15% gasoline). However, only flex fuel vehicles (FFVs) can use E85. FFVs can be fueled with unleaded gasoline, E85, or a combination of the two. Most vehicles produced after September, 2006 should be flex fuel and can handle up to 85% ethanol content. However, check whether your vehicle is flex fuel at the U.S. Department of Energy's Alternative Fuels Data Center. The easiest way to check if your vehicle takes E85 is to look at the color of your gas cap - it it's yellow, then you're vehicle is flex fuel!

For more information on biodiesel and ethanol, view our E85/B20 FAQs page.

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Tax Incentives for Biofuel Fueling Infrastructure

Federal Tax Credits for Fueling Equipment: Businesses and investors who purchased biodisel or E85 fueling equipment may receive a federal tax credit of 30% of the equipment and installation cost, up to $30,000. If you installed a fueling station in 2012, you have until April 15 to prepare and file your income tax return for 2012. Learn more about the Alternative Fuel Vehicle Refueling Property credit here.

 

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