DETROIT – Acknowledging America must reverse its escalating reliance on imported crude oil, U.S. Energy Secretary Samuel W. Bodman, in a speech at the Society of Automotive Engineers World Congress here, voices strong support for increased production and distribution of ethanol – and for more production of vehicles capable of burning the alternative fuel.

Domestic auto makers General Motors Corp. and Ford Motor Co. have in particular turned up the volume on the discourse regarding E85, a fuel comprised of 85% ethanol – currently derived almost exclusively from corn – and 15% conventional gasoline.

Both GM and Ford have announced plans to increase production of vehicles capable of using either E85 or gasoline and have joined initiatives to widen retail distribution of the fuel, currently available at only 600 fuel stations nationwide.

“I want to thank General Motors, Ford, DaimlerChrysler (AG) and Nissan (Motor Co. Ltd.) for their commitment to building some 700,000 flex-fuel vehicles in the current model year,” Bodman says. “We need to have more flex-fuel vehicles on the market of all vehicle types and classes.”

Although some critics have raised concerns about the cost of adding flex-fuel capability to light vehicles, Bodman says he is convinced the cost is “quite modest” – about $100 or less per vehicle.

He also hints the government once was, or still may be, considering mandating production of a certain number of E85-capable vehicles. But Bodman says in light of the current climate regarding E85 adoption, “I’m hopeful of avoiding mandates.”

Bodman says he believes E85 is the best current option for reducing the nation’s appetite for imported oil, which last year came with a $250 billion price tag.

“One of the reasons we have such high energy prices is there are no alternatives,” Bodman says.

He is aware of scientific and economic analyses that question the net energy gain of substituting E85 for gasoline – several studies have suggested it takes more energy to produce ethanol than the fuel ultimately returns, but says the Department of Energy commissioned a recent Argonne National Laboratory study that confirms ethanol delivers more energy than it takes to produce.

The cost and availability of ethanol is an issue, he says.

“Cost will be substantially reduced if we’re able to use less-expensive feedstock,” Bodman says, adding that raw material options could include switch grass, wood pulp and other plant sources not in the human food chain.

The most important aspect of ethanol, however, is that it is sourced entirely in the U.S., he says. Complete domestic production of ethanol is “what I find exciting,” Bodman insists.

He also says there is a near-term place for hybrid-electric vehicles and diesel engines, adding the DOE is seeking $6.7 million worth of additional funding under the Advanced Energy Initiative to research improved batteries and systems that could further development of so-called “plug-in” HEVs.

As for the prospects for diesels, Bodman calls a “step in the right direction” the plan of DC’s Mercedes-Benz unit to offer this fall in the U.S. several models with advanced, low-emitting diesels that are emissions-compliant in all 50 states, a technical hurdle that to now has curbed many auto makers’ enthusiasm to expand diesel availability in the U.S.

Bodman says he and his department see hydrogen-fueled fuel-cell vehicles as the endgame, saying such vehicles are virtually emissions-free and enjoy fuel economy roughly double that of contemporary combustion-engine-powered vehicles.

The Advanced Energy Initiative has the “goal of putting hydrogen-powered vehicles on the road by the year 2020 (and plans) mass-market acceptance by the year 2040,” he says.

bvisnic@wardsauto.com