Deutsche Welle reports that Germans are afraid of ethanol and refuse to use it.

E10 is safe for 93 percent of all cars registered in Germany and 99 percent of all German-made cars. But that has apparently done little to reassure drivers, 70 percent of whom are sticking to what they know.

Apart from concerns over the 10 percent ethanol, E10 is also less efficient, somewhat negating the price advantage.

Blame for resistance in Germany has been put on the industry that produces and sells E10 there.

Germany’s Environment Minister Norbert Röttgen heavily criticized the fuel industry for not properly advertising E10 at gas stations. “The confusion that the petroleum industry has created is unacceptable,” he fumed.

Haha, he fumed. For what it’s worth Deutsche Welle often has the best puns in the news; who says Germans have no sense of humor?

The German automobile association ADAC has thrown its support behind the minister. “The petroleum industry alone is responsible for the chaos that followed the introduction of E10,” said ADAC spokesman Maxi Hartung. “For there to be absolutely no information available on a newly-introduced product is the wrong approach.”

There is a lot of confidence in Maxi’s statement. Calling the petroleum industry “alone” with “absolutely no information” is a bit extreme, but it is easy to see why the ADAC is so upset.

Educating drivers would be a boon to the automobile industry. It increases the likelihood of engine upgrades or vehicle replacement. The problem, however, is that this also could lead directly to a shift into efficient engines (and a trade-in for diesel). That lowers consumption of fuel and moves more Germans away from petroleum. While this is the goal of government regulation (reducing dependence on petroleum) the petroleum industry is hardly an eager proponent of this scheme; they are not likely to want to push demand down for their primary product (gasoline) any farther unless forced by regulations.

All of that speculation aside, I thought this was the most interesting statement in the article:

Many drivers prefer the old gas, even though it costs up to eight euro cents (11 US cents) more per liter, for fear…

Aha! Drivers prefer more expensive fuel at the pump, despite the option to spend less, because they are worried about long-term costs!

Surprised?

What would they decide if offered more expensive fuel that has a lower long-term collective cost (e.g. clean, domestic, renewable)…?

Studies of biodiesel, by comparison, suggest that Germans have adopted it rapidly and worry only that it may come from un-ethical sources. Ironic, when you consider where/how petroleum hstorically has been sourced.

Germans switched to biodiesel so quickly, in fact, that the government feared a tax revenue loss. They added laws expected to drive down biodiesel enthusiasm and protect petroleum demand while introducing ethanol…but they apparently did not plan for a lack of support from the petroleum industry, or for resistance from drivers.

The dark green bars above represent the extremely rapid adoption of biodiesel by German drivers and the plateau expected from taxation.

A smarter plan for the German government would have been to regulate ethical sourcing for fuels (to address consumer concerns) and then encourage consumers to move away from gasoline to diesel. Skip the ethanol phase.

Ethanol has become too small a step at a steep cost — high risk with little or no reward at all. The resistance from gasoline drivers makes it an even less attractive option. Biodiesel, meanwhile, has shown solid demand with far more supply options — low risk with high reward.