RED HERRING | Ethanol Bubble About to Burst?

RED HERRING Ethanol Bubble About to Burst?: "Ethanol Bubble About to Burst?

Survey finds supply could soon outstrip demand if the industry doesn’t fill distribution gaps.
January 22, 2007
By Jennifer Kho

Ethanol could be headed for a bubble if the industry doesn’t make some big changes, according to a report released Monday by Pavilion Technologies.

The software company, which among other things sells ethanol-manufacturing software, commissioned the Internet-based survey from Harris Interactive. It found that only 5 percent of U.S. consumers use biofuels, and 45 percent of drivers don’t understand the difference between biofuels and conventional fuels.

Of the 95 percent who don’t use biofuels today, 57 percent don’t know where to buy them, and 57 percent say they don’t think their car can run on biofuels even though all cars in the United States can use 10 percent blends of ethanol.

These results, along with the fact that less than 1 percent of gas stations carry E85, an 85 percent blend of ethanol, led Pavilion to conclude that supply could soon outstrip demand. That conclusion could serve as a warning for the growing number of investors financing ethanol companies. Ethanol Bubble About to Burst?

Survey finds supply could soon outstrip demand if the industry doesn’t fill distribution gaps.
January 22, 2007
By Jennifer Kho

Ethanol could be headed for a bubble if the industry doesn’t make some big changes, according to a report released Monday by Pavilion Technologies.

The software company, which among other things sells ethanol-manufacturing software, commissioned the Internet-based survey from Harris Interactive. It found that only 5 p"