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EPA approves fuel blend containing 15% ethanol - 'E15' won't likely be at the pump soon, since sizable hurdles remain

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Posted / Last update: 18-06-2012
The U.S. Environmental Protection Agency gave final approval on Friday for a fuel blend containing 15 percent ethanol to be sold at gas stations across the country, but a series of hurdles remain that could prevent it from being available to consumers anytime soon

Until now, U.S. companies were not allowed to sell a fuel that contained more than 10 percent ethanol for use in most conventional gasoline-powered vehicles. Most gasoline sold in the United States contains the blend of 90 percent gasoline and 10 percent ethanol.

The EPA, which approved the new blend in January 2011, had to first complete a series of steps before E15 could go on sale to prevent misfueling and ensure that the fuel is properly marked and sold. The blend has been approved for use in cars and light trucks from the 2001 model year onward, but it is banned from older vehicles and light equipment.

“I think there are a number of stations, particularly in the Midwest, that will be very interested in introducing E15, and there will certainly be encouragement from the renewable fuel industry for it to be done as quickly as possible,” U.S. Department of Agriculture Secretary Tom Vilsack said.

Vilsack said there are a limited number of flex-fuel vehicles in the U.S. that can use a fuel containing 85 percent ethanol and 15 percent gasoline. And with most gasoline containing 10 percent ethanol, boosting the additive to 15 percent was one way to increase the use of the renewable fuel, he said. “Anything that paves the way for E15 is a good thing, and today we got the last hurdle removed, so we should be able to see additional biofuel use,” Vilsack added. Still, he acknowledged it will “take some time” before the E15 blend is readily available.

The EPA said while some companies may introduce E15 into the marketplace, some federal, state and local requirements, along with other issues, must still be addressed. For example, dispenser and tank compatibility with E15 must be considered by marketers of the fuel. In addition, because several states restrict the sale of some gasoline-ethanol blends, law changes might be needed before E15 can be sold in those states.

Iowa is the nation’s largest ethanol-producing state, with 41 plants that in 2011 produced about 3.7 billion of the total 13 billion gallons of ethanol produced nationwide.

Corn-based ethanol has been touted by the ethanol industry and American farmers who produce corn as a way to reduce U.S. dependence on imported oil, create jobs and boost income for rural communities. Critics counter that ethanol leads to food inflation by driving up the cost of meat and poultry.

Pat Westhoff, director of the Food and Agricultural Policy Research Institute at the University of Missouri, said the rollout of E15 to the marketplace could be very gradual. “I wouldn’t expect to be seeing it in gasoline stations across the country anytime real soon,” added Westhoff, noting the Midwest as one exception where the fuel could appear relatively quickly. “As of right now, there appears to be some resistance on the part of consumers because of concerns about mileage and concerns about (its impact) on their vehicle.”

In a joint statement, the Renewable Fuels Association and Growth Energy called the announcement “a victory for American consumers.”

The American Petroleum Institute, which represents 500 oil and natural gas companies, downplayed the EPA announcement. “The bottom line is that it’s premature to say that it’s ready to be sold — the obstacles remain. Even the EPA acknowledged obstacles remain,” said Bob Greco, an API director. “Our position still remains that the partial waiver of E15 was premature.”

A series of studies have promoted the money ethanol has saved consumers at the pump. Most recently, a study conducted by economic professors at the University of Wisconsin and Iowa State University and sponsored by the Renewable Fuels Association estimated ethanol reduced wholesale gasoline prices by an average of $1.09 per gallon in 2011.

A federal renewable fuel standard mandates the use of 13.2 billion gallons of alternative fuels in 2012, with most of it coming from corn. By 2022, the figure would require 36 billion gallons to be blended into transportation fuel.

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