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The long response ++
Lots of questions raised here.
First, as has been mentioned, there is a difference between NA and Euro measures for octane rating, more properly called anti-knock index (since there isn't any particular amount of octane in the fuel). Euro measure is the Research Octane Number, RON. NA measure is the average of the RON and the Motor Octane Method. This average is often called the pump octane, but (R+M)/2 is more precise. Both measurements are obtained on test engines, one is a better measure of resistance to knock at higher rpm and one at lower rpm, but it is somewhat academic. 100 is the rating of pure octane, and 90, as an example, has the same resistance to predetonation as 90% octane. Pump fuel with an AKI of 90 doesn't have 90% octane, it has the characteristics of a fuel with 90% octane. Anything above 100 is a mathematical extrapolation, since it is difficult to have more than 100% of anything in a tank.
An approximation of the difference between pump octane and RON is 6 points difference. This varies with other factors, but it is a good generalization. Thus, 98 RON is very similar to 92 in NA. 95 RON is the same as 89, or mid-grade, in NA.
Aviation gas (usually 100 octane and above) is not measured the same way. It has an AKI higher than the best premium, but it can't be directly compared, as the test cycle differs.
I am one of the ones who uses 89 most of the time. That doesn't mean that I recommend you do so. The correct fuel is the lowest AKI that resists predetonation. Anything more is 'wasted' octane, there is no more power in it. If the engine can take advantage of that higher AKI (through higher compression ratio, turbo or supercharging, etc) then go for it. You can't tune (in the classic sense of tuning) to take advantage of the higher octane with modern engines, it requires engine disassembly and new parts, or at least a chip (which may or may not remap the ignition). Not like the days in which recurving a distributor brought big wins. With a modern stock engine, in good condition, the recommendation of the manufacturer is the best starting point. In my case, since using 89 causes no power loss that I can sense, and since there is no fuel consumption increase measured over multiple tanks, then I am reasonable confident that the engine computer is not retarding the timing to prevent predetonation. If it was, I would get less power and higher fuel consumption. Since those are not evident, I use 89. If I didn't want to test it, and measure it, it would just be easier to use 92, but that is a cost premium of at least $.12/litre here, or $.54/Imp gallon, or $.45/US gallon. Also, my employer pays for regular fuel, but not for premium, which bugs me. I split the difference and use mid-grade, but I don't use 87 unless I am stuck, as I can tell a difference in engine operation with that fuel. I don't think it will hurt the engine (much), but I didn't buy a BMW to lose power by retarding the timing. In my area of the country, we have good fuel. Lots of areas don't. When I travel, I use 92, since I don't know the suppliers in those areas, and it is just safer to not have to worry about it.
Final point on the pump AKI: the pump number is the minimum AKI, legally, it is not the actual. The supplier should have a fuel with at least what is posted on the pump, or risk charges (in my area, from the federal government). They are fine to be a point or two high.
BMW and other manufacturers need to consider the wide variety of fuel quality available when they design the engine map. They are being safe with their 92 recommendation (you would likely do the same) If in doubt, just use 92 in NA. If you try 89 and notice any difference on 89, you should use 92. This will also vary with summer fuel and winter fuel, and lots of other factors.
Altitude: less oxygen at altitude equals less power. You can calculate the derate per 1000 feet of altitude (many manufacturers publish it for certain types of engines, particularly heavy equipment). Turbocharging compensates, but usually not fully (unless you are really not that high up).
Sanguru: hopefully that puts me in your second group. If not, well, I tried.
MikeB: I agree.
Ianbrown: Good comments, just one quibble, but it might be our language differences. I wouldn't say that all engines have detonation, but they do all have ignition. I would refer to detonation as an uncontrolled flame front (explosion) versus combustion, or burning, with a controlled flame front. Predetonation is bad, but so is detonation, at least here. Detonation may mean something different where you are.
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2007 X3 3.0si, 6 MT, Premium, White
Retired:
2008 535i, 6 MT, M Sport, Premium, Space Grey
2003 X5 3.0 Steptronic, Premium, Titanium Silver
2002 325xi 5 MT, Steel Grey
2004 Z4 3.0 Premium, Sport, SMG, Maldives Blue
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