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Charging into the Blend Wall: Conjoint Analysis of Consumer Willingness to Pay for Ethanol Blend Fuels

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  • Aguilar, Francisco X.
  • Thompson, Wyatt

Abstract

Ethanol use in the U.S. rose sharply in recent years due to public policy and a spike in petroleum prices, and remains high. Public support for ethanol includes mandated minimum levels of use nationwide. However, rather little is known about consumer demand for ethanol and much less about demand by type of blend and ethanol source. We used trial survey data and conjoint analysis to overcome the lack of historical data on consumers’ preferences for ethanol blend fuels. Preliminary findings based on responses from vehicle drivers in Missouri suggest that price is the primary factor behind fuel preferences. The disclosure of ethanol originated from woody feedstocks had a significant effect on preferences ceteris paribus. Ethanol blends of 20 percent had a negatively non-significant statistical effect compared to no-ethanol fuels or those with a 10 percent content. These findings will be tested using different models expanded to a nationwide pool of motor vehicle drivers.

Suggested Citation

  • Aguilar, Francisco X. & Thompson, Wyatt, 2010. "Charging into the Blend Wall: Conjoint Analysis of Consumer Willingness to Pay for Ethanol Blend Fuels," 2010 Annual Meeting, July 25-27, 2010, Denver, Colorado 61772, Agricultural and Applied Economics Association.
    • Handle: RePEc:ags:aaea10:61772
    DOI: 10.22004/ag.econ.61772
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    1. Babcock, Bruce A. & Beghin, John C. & Mohanty, Samarendu & Fuller, Frank H. & Fabiosa, Jacinto F. & Kaus, Phillip J. & Fang, Cheng & Hart, Chad E. & Kovarik, Karen & Womack, Abner W. & Young, Robert E, 2000. "FAPRI 2000 World Agricultural Outlook," FAPRI Staff Reports 32045, Food and Agricultural Policy Research Institute (FAPRI).
    2. Harry de Gorter & David R. Just, 2007. "The Welfare Economics of a Biofuel Tax Credit and the Interaction Effects with Price Contingent Farm Subsidies," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 91(2), pages 477-488.
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    1. Lilibeth A. Acosta & Damasa B. Magcale-Macandog & K. S. Kavi Kumar & Xuefeng Cui & Elena A. Eugenio & Paula Beatrice M. Macandog & Arnold R. Salvacion & Jemimah Mae A. Eugenio, 2016. "The Role of Bioenergy in Enhancing Energy, Food and Ecosystem Sustainability Based on Societal Perceptions and Preferences in Asia," Agriculture, MDPI, vol. 6(2), pages 1-26, April.

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