Look for the debate over raising the octane levels at U.S. gasoline pumps -- perhaps making 93 octane the new regular -- to get a lot louder between now and 2017.
Here’s why: Automakers and suppliers are spending record amounts of money on product development to meet the government-mandated 54.5 mpg fleet fuel economy average in the 2025 model year.
They very likely will need higher octane gasoline to get there.
Octane is a measurement of gasoline’s resistance to ignite when compressed in an engine’s cylinder. High octane can make a small engine produce more power. For example, if you fill the tank of a 2015 Ford Mustang equipped with the turbo four-cylinder engine with 93 octane premium, the horsepower is 310. But switch to 87 octane regular and the horsepower level drops. Ford won’t say by how much, but a Ford Fusion loses 9 hp running on regular vs. premium.
In 2017 the EPA and the National Highway Traffic Safety Administration plan to meet with automakers in a midterm review of the 2025 model year fuel economy standards.
Automakers are making good progress in improving fuel economy. In March, the average fuel economy of new-vehicles sold in the United States was 25.4 mpg, according to the University of Michigan’s Transportation Research Institute, up from 22.1 mpg five years ago. And automakers are not lobbying for changes to the fuel economy standards.
Weight is coming out. More gears are going in. Friction is being reduced. Aerodynamic efficiency is being increased. Nearly every component on a vehicle that uses electricity is being managed for maximum efficiency. Waste heat from the exhaust and coolant, for example, is being captured for faster warm-ups.
Automotive engineering is closing in on rocket science in technical complexity, it seems.
But fuel efficiency’s low-hanging fruit is long gone, and automakers are now spending millions for each 1 percent gain in efficiency.
On average, many automakers still must improve fuel economy about 5 percent each year to meet the 2025 model year standard. That will be a tough and costly engineering challenge.
For not much in engineering cost, modifying engines to run on higher octane fuel can deliver about a year’s worth of fuel economy improvements on that road to 54.5 mpg.
But calling for premium gasoline to become the new regular puts automakers in a tough spot. And so far, they are not doing it, at least publicly.
On one hand, high octane gasoline further opens the door to smaller, high performing engines that can yield real-world fuel economy gains of between 3 and 6 percent, while reducing carbon dioxide emissions about 2 percent, according to a panel of experts who spoke last week at the SAE World Congress in Detroit.
And those gains would come cheap by today’s engineering standards. Raising an engine’s compression ratio from 9.0:1 to 12.0:1 can be done with a simple reshaping of pistons or a redesigning of the cylinder head’s combustion chambers. Some additional expense might be involved because of the need for more robust gaskets and changes to the fuel system to handle more ethanol.
“If we were able to tune the engine and optimize spark for higher octane, we could turn that into higher fuel economy,” Dave Leone, executive chief engineer for Cadillac’s V-series performance cars, told me. He said 90 would be a good octane level for regular fuel with 95 octane becoming the new premium. Such a system would roughly align the United States with Europe in octane ratings.
(To align exactly with Europe, regular gasoline in the U.S. would be between 90 and 95 octane, premium would be above that and superpremium would be 102 octane.)
On the other hand, premium gasoline averages around 37 cents more per gallon than regular and raises ownership costs for consumers. That presents automakers with marketing and PR nightmares. Few car companies want to force customers to use premium fuel, especially when the average transaction price for U.S. light vehicles is more than $32,000. Running a car on premium instead of regular adds $1,500 in operating costs over the life of a car, according to Amir Maria, a research engineer at Chevron Energy Technology Co.
Further complicating matters: today’s cheap gasoline. The price of a barrel of oil is down nearly 50 percent since June. In many states, the price of regular gasoline dipped to under $2 per gallon this year, but the national average has bounced back to around $2.55 per gallon today. That’s still far below the $3.83 national average in March 2012.
Cheap fuel is causing American buyers to revert to old habits. SUVs and trucks are flying off dealer lots. Small, fuel-efficient cars are not. Three years ago, when gasoline was nearly $4 per gallon, cars sales reached a high of 54.7 percent of the new light-vehicle market. Today, the split is now about 45 percent cars vs. 55 percent light trucks.
Automakers are counting on strong sales of hybrid, electric, diesel and fuel-efficient vehicles to meet the 2025 model year standards.
Refiners are resisting early efforts to produce gasoline with higher octane, citing increased costs. According to Chevron, 87 percent of gasoline produced today is 87 octane; premium is a niche product. Raising octane in the refining process adds cost because the fuel produced requires more hydrocarbon molecules.
Octane also can be raised by adding more ethanol, but that brings with it another set of problems. Gasoline with too much ethanol can damage the fuel systems of today’s vehicles, especially older ones not engineered to burn fuel with more than 10 percent ethanol. And gasoline with high ethanol content carries less energy, meaning lower miles per gallon and more frequent stops to refill the tank.
If fuel prices stay low, if Americans continue to buy SUVs and trucks, and if the Feds don’t waiver on the 54.5 mpg standards, the octane debate may start moving from the quiet backwater of industry conferences and engineering seminars to the top of the agenda.