• Ron Kotrba

B20 biodiesel cheaper than E85, diesel fuel and gasoline in 2019

Updated: Sep 9


A bar graph of average vehicle fuel prices per type of fuel from 2019.
Source: U.S. DOE, Clean Cities Alternative Fuel Price Report

Do you remember when diesel fuel was consistently cheaper than gasoline in the U.S.? I certainly do. For the past decade and a-half or more, however, diesel fuel has sold at a premium to gasoline.


According to Ron Jessen with Cenex, on-road diesel fuel prices have been higher than regular-grade gasoline prices almost continuously since September 2004.


Jessen says five reasons can help explain the price gap. Those include:


  • Stronger diesel demand in other countries


  • Taxes—the federal tax on diesel fuel is 6 cents higher per gallon than gasoline


  • Transition to ultra-low sulfur diesel—the refining industry had to invest $8 billion into infrastructure, and the daily refining costs are higher than higher-sulfur diesel fuel


  • Seasonality—when heating oil demand rises in the winter, diesel prices tend to increase


  • And enhanced additive packages to improve shelf life, performance, cold flow and bacteria resistance.


Even in July, at the height of the coronavirus pandemic, on-road diesel fuel was running $2.48/gallon to gasoline’s $2.22/gallon, according to Clean Cities’ Alternative Fuel Price Report and data from the U.S. Energy Information Administration*. During this same time, biodiesel ("B99/B100") was $3.15/gallon while B20 (a 20 percent blend of biodiesel and diesel fuel) was $2.35/gallon. E85 ethanol was $1.99/gallon while propane topped the charts at $2.74/gasoline gallon equivalent.


More interesting, however, is the 2019 data. Gasoline prices in 2019 averaged $2.62/gallon whereas E85 ethanol prices averaged $2.91/gallon. On par with the past 15-plus years, diesel fuel was priced at a premium to gasoline, but only by 9 cents, averaging $2.71/gallon.


And although B99/B100 averaged $3.54/gallon in 2019, the average price of B20 blends of biodiesel last year was cheaper than E85, diesel fuel and gasoline, coming in at just $2.57/gallon—34 cents cheaper per gallon than E85, 14 cents cheaper than straight diesel fuel, and 5 cents cheaper than gasoline.


Considering all of the fuel performance, societal, environmental, agricultural and employment benefits biodiesel provides, it should never just be a price point to people—but for those who deride biodiesel because they argue it’s too expensive (given all the benefits, it should be more expensive than diesel fuel on the merits of its higher cetane and added lubricity alone, not to mention the nonperformance-related benefits mentioned above), using B20 can actually save your diesel-powered trucking or fleet operations.


Say you own a fleet of 10 heavy-duty trucks, and each truck consumes 10,000 gallons per year. In 2019, if you ran B20 instead of straight diesel fuel, at a discount of 14 cents/gallon, this could have saved you $14,000 in out-of-pocket expenses last year.


*Quarterly retail price data, including taxes, were averaged for 2019. A gasoline gallon equivalent (GGE) is a unit of fuel that has the same amount of energy as one gallon of gasoline. Of gasoline, diesel fuel, B99/B100, B20 and E85, E85 has the fewest BTUs per gallon while diesel fuel has the most.

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