Multiple news media have reported—and a statement by Agriculture Secretary Sonny Perdue made it semi-official—that President Donald Trump has directed the EPA to begin rulemaking to allow year-round sales of gasoline with 15 percent ethanol (E15).
Currently, an EPA provision that caps Reid Vapor Pressure (RVP)—a measure of how quickly fuel evaporates—prohibits the use of E15 during the summer months (except in flex-fuel vehicles that can burn gasoline with any amount of ethanol). The RVP restriction has long frustrated ethanol manufacturers; gas retailers that must vary the product they can sell based on the season; and farmers in states that produce ethanol feedstock, particularly corn.
Iowa Leaders Celebrate
In an April letter to Trump, Iowa’s Republican Senator Chuck Grassley asked the president to follow through on his commitment to allow E15 to be sold year-around. Iowa leads all states in ethanol production.
“Opening the door for year-round sales of higher blends of ethanol is a victory for farmers, Rural America and the nation as a whole,” Grassley said in a statement following news of the president’s order to the EPA. “Allowing an open marketplace with more fuel options for consumers encourages competition, drives down consumer fuel costs and is good for the environment. It also maintains and creates jobs in parts of the country that need them most and decreases America’s dependence on foreign oil.”
Growth Energy, an ethanol advocacy organization, said nationwide E15 sales would drive demand for 2 billion bushels of American corn and help restore growth in rural communities hit hardest by the downturn in farm income.
News of the president’s directive was also welcomed by Iowa’s Governor Kim Reynolds (R).
“Today’s decision from President Trump is a big win for Iowa,” said Reynolds in a statement. “I am grateful to the president for following through on his promise to allow the sale of E15 year round—a decision that will bring greater stability to the ag economy. Once again, President Trump has shown his commitment to farmers in Iowa and the rest of the country.”
According to Reynolds, Iowa’s E15 sales grew by 193 percent despite previous summertime restrictions. Also, the number of Iowa fuel stations offering E15 grew from 40 to 217 over the last year. Reynolds says the president’s announcement alone should lead to stronger sales.
One-Sided Approach
The petroleum industry, which would find more of its traditional product displaced should E15 be approved for year-round sales, has routinely opposed any extension of E15 use. Apart from the economic hit the industry would take, petroleum organizations have argued that cars predating 2001 would be damaged by E15 in their tanks. The American Petroleum Institute (API) said that three out of four vehicles on the road today in America weren’t built to use E15, and the fuel isn’t compatible with motorcycles, boats, lawn equipment, or all-terrain vehicles (ATVs). A number of automakers have also said that using E15 could potentially void vehicle warranties.
“Putting a fuel into the marketplace that the vast majority of cars on the road were not designed to use is not in the best interest of consumers,” said API President and CEO Mike Sommers. “Vehicle compatibility tests have shown that high ethanol levels in gasoline can damage engines and fuel systems.”
“The President has promised to broker a deal to reform the RFS [Renewable Fuel Standard] that works for all stakeholders,” said Chet Thompson, CEO of American Fuel and Petrochemicals Manufacturers. “This isn’t it. We are disappointed to see that despite good-faith efforts by refiners to find potential solutions, the Administration has unilaterally embraced a one-sided approach that only serves the ethanol community, which has shown little interest in finding common ground.”
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