The EPA says it will approve the sale of E15 — which contains 15 percent ethanol and 85 percent gasoline — before the start of the summer driving season, as promised by President Trump. To make sure the agency meets its goal, Senate Finance Committee chairman Chuck Grassley said on Tuesday the EPA should propose a stripped-down regulation devoted solely to the corn-based biofuel.
When Trump gave the go-ahead for E15 last October, he said EPA would also revamp trading of biofuel credits, known as RINs, in the same regulatory action. Ethanol makers had long sought E15 for summer gasoline, but oil refiners had also complained about price spikes in the credits. The two industries fought for nearly year until Trump decided to tie the two issues together giving each side a victory.
Grassley, an Iowa Republican, said: “Decoupling would signal how serious the administration is about getting E15 out for summer driving.”
In a statement, EPA assistant administrator Bill Wehrum said the agency will act on E15 and RIN reform, “as the president instructed us to do. This will be done in one regulatory package released at one time with a target of completion by the start of summer driving season.”
At present, E15 sales are cut off from June 1 to Sept. 15, when warmer weather increases the risk of smog from fuel evaporation. The blackout period deters some retailers from offering E15 at all, because they would need to change pumps and add warning labels during the summer to meet clean air requirements.
Farm groups say E15 in the summer will mean larger demand for corn for biofuels, which the oil industry opposes because it would replace gasoline. The ethanol industry uses between three and four of every 10 bushels of the U.S. corn crop in making corn ethanol, the dominant biofuel in the nation. The traditional blend of ethanol into gasoline is 10 percent. The ethanol industry produced a record 16.1 billion gallons of the fuel last year.
Grassley, from the No. 1 corn growing state and a longtime supporter of biofuels, told reporters that he began encouraging EPA months ago to split E15 and RIN reform into two proposals. There are rumors EPA will do so, he said, adding, “I have not confirmed that to be the case.” The Renewable Fuels Association (RFA), a biofuels trade group, endorsed stand-alone action on E15 last month because of worries that the partial government shutdown would slow the regulatory process. The EPA initially said it would propose the E15 rule this month, giving it less than four months to complete work, including time to gather and analyze public comment.
“When EPA finally puts out its proposed rule to allow year-round sale of E15, we’ll be ready,” said RFA chief executive Geoff Cooper at the National Ethanol Conference in Orlando. “RFA will throw everything we’ve got into ensuring a defensible rule is finalized as quickly as possible, expanding the domestic ethanol market, enabling competition and eliminating — once and for all — a needless bureaucratic barrier that offers no economic or environmental benefit whatsoever.”
Separately, the biofuels trade group Growth Energy filed suit against the EPA over its use of “hardship” waivers that free small refineries from compliance with the Renewable Fuel Standard, which guarantees biofuels a share of the fuel market. Refiners are required to blend enough ethanol into gasoline to satisfy the RFS, generating RINS in the process. Refiners that don’t meet the RFS mandate must purchase RINs in the market but the refinery industry has complained that speculation has driven up prices for the credits and many smaller refiners applied for hardship wavers instead.
The EPA did not address the waivers when it set the RFS for this year. Growth Energy said its lawsuit in the U.S. appeals court “calls for greater accountability from EPA to ensure that every renewable fuel obligation is fulfilled as the law intended.”