Ethanol, Petroleum and Ag Groups Express Support for Year-Round E15 Legislation

November 22, 2022

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(Renewable Fuels Association) In a letter sent yesterday to U.S. Senate and House leadership, a broad coalition of energy and agriculture organizations called on Congress to quickly adopt legislation that would resolve inconsistent fuel volatility regulations. Specifically, the groups expressed support for legislation that would result in equal regulatory treatment for all gasoline blends containing 10 percent ethanol (E10) or more, including gasoline with 15 percent ethanol (E15). Such legislation would permanently remove the regulatory barrier that has historically made it extremely difficult for retailers to offer E15 in the summertime.

The letter, sent to Senate Leaders Chuck Schumer and Mitch McConnell, House Speaker Nancy Pelosi, and House Minority Leader Kevin McCarthy, was signed by the Renewable Fuels Association, American Petroleum Institute, American Farm Bureau Federation, Association of Equipment Manufacturers, Growth Energy, National Association of Convenience Stores, National Corn Growers Association, National Council of Farmer Cooperatives, National Farmers Union, National Sorghum Producers, NATSO, representing truckstops and travel plazas, and SIGMA: America's Leading Fuel Marketers.

“Due to the current policy, it is extremely difficult for many fuel marketers and retailers that may desire to offer E15 to their customers in the summer months to source that product,” according to the letter. “Our groups have come together—for the first time ever—to support legislation that would resolve this issue once and for all.”

The groups are advocating for a simple legislative fix that would provide equal treatment nationwide to all gasoline blends containing 10 percent ethanol or more, while simultaneously superseding state regulatory action recently sought by a group of governors. “By ensuring uniformity across the nation’s fuel supply chain, federal legislation will provide more flexibility and result in more consistent outcomes than a state-by-state regulatory landscape,” the letter says.

“In the absence of such legislation, we could see gasoline marketplace uncertainty and political disputes over E15 that would continue to resurface every summer. Thus, we urge Congress to act quickly to adopt legislation that will bring certainty and consistency to the fuel market, while also finally resolving long-standing differences among many stakeholders about fuel volatility regulations.” READ MORE

Big Oil joins farmers, biofuel groups to tout more ethanol in U.S. fuel (Reuters)

Ag, Energy Groups Press Congress on E15 -- Ag, Energy Groups Push Congress for E15 Fix in Lame-Duck Session (DTN Progressive Farmer)

ENERGY AND AG GROUPS SEEK PERMANENT YEAR-ROUND E15 FIX (Brownfield Ag News)

Biofuels groups have API on their side in E15 push. Will that be enough? (AgriPulse)

Dozen groups call for national E15 legislation (AgriPulse)

Diverse Groups Push for Year Round E15 (Energy.AgWired.com)

Ethanol, oil and ag groups support year-round E15 legislation (Ethanol Producer Magazine)

Fight to lift US E15 sales restrictions creates strange bedfellows among oil, biofuel groups (S&P Global)

U.S. SENATORS INTRODUCE BILL TO EXPAND E15 GASOLINE SALES, WITH SUPPORT FROM OIL GROUP (Reuters)

Oil Sector Pivot Toward Year-Round E15 Boosts Prospects For Ethanol (Inside EPA)

Excerpt from Reuters: API's support is a win for the biofuel and farm groups because the oil industry has at times resisted efforts to expand the market for ethanol.

U.S. Environmental Protection Agency (EPA) anti-smog regulations restrict summertime sales of E15, even though research has shown the higher percentage blend may not increase smog relative to the 10% blend called E10 that is now sold year-round.

Reuters reported this month that API began cooperating with the biofuels trade group after governors from major corn-producing Midwestern states requested the EPA allow for expanded sales of E15 in their states. The governors' proposal raised oil industry concerns about fuel regulations differing from state to state. READ MORE

Excerpt from DTN Progressive Farmer: The Biden administration granted a waiver in April that allowed E15 sales to continue through the summer months after a Trump administration rule was thrown out by a federal court. Still, the industry continues to wait for either the EPA to issue a new proposed rule or Congress to make a permanent fix before the beginning of the next summer driving season in June 2023.

Governors in nine states also are awaiting a response from EPA on their petitions to allow year-round E15 sales in their states, including Iowa, Illinois, Kansas, Minnesota, Nebraska, North Dakota, South Dakota, Wisconsin and Ohio.

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E15 has been hamstrung by a technicality known as Reid vapor pressure, or RVP.

The nine states asked for the removal of the 1-pound-per-square-inch (psi) RVP waiver for E10 ethanol blends. Currently, there is an RVP limit of 10 psi for E10 and 9 psi for gasoline in the summer months.

The Clean Air Act allows governors to notify EPA that they wish to reject the use of the 1-psi waiver for E10 in their states. This would result in the application of the same volatility limitation to both E15 and E10 in their states -- essentially putting E10 and E15 on the same footing.

This would compel fuel suppliers to reduce RVP of CBOB, a common grade of gasoline produced by refiners in the U.S., from 8.8 to 7.8 psi. The Clean Air Act requires governors to show such action would benefit air quality in their states.

Congress previously amended the Clean Air Act in 1990 to provide a 1-psi RVP waiver for fuel blends "containing gasoline and 10% ethanol." At the time, E10 was the highest ethanol blend stock sold.

After years of lobbying by the biofuels industry, EPA issued a rule in 2019 declaring E15 as "substantially similar" to E10 and extended the RVP waiver to gasoline "containing at least 10%" ethanol to E15. READ MORE

Excerpt from S&P Global: Current law offers a summertime waiver of Reid Vapor Pressure (RVP) volatility allowance requirements to biofuel blends containing 10% ethanol. The EPA in 2019 issued a rule extending that waiver to blends containing more than 10% ethanol, but the DC Circuit Court of Appeals last year vacated that regulation.

The letter sent to Senate Leaders Chuck Schumer, Democrat-New York, and Mitch McConnell, Republican-Kentucky, as well as House Speaker Nancy Pelosi, Democrat-California, and House Minority Leader Kevin McCarthy, Republican-California, supports legislation extending the one-psi RVP tolerance to gasoline blends containing 10% ethanol or more.

The groups argued against the current incongruent treatment in RVP tolerance, especially because E15 "is slightly less volatile than E10."

Such a fix was included in the Lower Food and Fuel Costs Act, H.R. 7606, House Democrats' response to soaring gasoline prices exacerbated by Russia's invasion of Ukraine and inflation that has sent the price of food and other goods skyrocketing.

That bill passed the House of Representatives June 16 in a 221-204 vote that saw a dozen lawmakers cross the aisle as seven Republicans voted with the majority and five Democrats joined the rest of the GOP to vote against the bill.

Narrow margins in the Senate make passage of any bill a formidable task, even though the issues this measure addresses have not typically solely been decided down party lines, with lawmakers instead weighing farm versus oil interests.

With funding the government to avert a shutdown, passage of the National Defense Authorization Act, and a slew of other key issues on the jam-packed to-do list for the lame duck session, it is unclear whether E15 will make it onto the agenda as this Congress wraps up.

Margins will remain slim for the next Congress, with Democrats retaining control of the Senate while the House flips to Republican control.

State petitions

The trade groups also called for simultaneously nullifying petitions from Midwest states that sought to exercise their Clean Air Act authority to ensure E15 could permanently be sold within their borders year-round.

Those petitions seek to eliminate the one-psi RVP allowance for E10 in their states, an "approach [that] would essentially require the same gasoline blendstock to be used for the sale of E10 and E15 in these states, which could require adjustments in fuel supply logistics in those states," the trade groups said in the letter. READ MORE