Ethanol industry disputes API’s ethanol claims

By Ann Bailey | September 10, 2015

The U.S. fuel ethanol industry has dismissed the American Petroleum Institute’s latest diatribe on the Renewable Fuel Standard, saying the API’s assertions are false and an effort to restrict American consumers’ fuel choice.

The API released a study that said the statutory biofuels mandate under the renewable fuel standard (RFS) was not feasible to achieve and could cause great harm to Americans and the U.S. economy. API Downstream Group Director Bob Greco told reporters in a conference call that the mandates try to force more ethanol into gasoline that is safe for most cars on the road.

National Economics Research Associates predicts that refiners will be forced to reduce the nation’s fuel supply gasoline and diesel by 30 percent, rather than risk damage to vehicles, Greco said during the conference call. The research group also concluded consumer demand for higher ethanol content gasoline such as E85 and E15 is too small to serve as an outlet for higher ethanol mandates.

Dissemination of the recent anti-ethanol information by the API is business as usual, according to a Fuels America press release. The talking points from the API are not new and have been disproven many times.

The oil industry repeatedly opposes efforts to improve air quality impacts from the U.S. supply and denies that is the right thing to do at the same time it makes “wild doomsday predictions” about the economic consequences that have never happened, Fuels America said.

Gas retailers continually have lauded the benefits of higher blend fuels. For example, Cheryl Near, owner of Jump Start gas station in Wichita, Kansas, said the United States needs to support homegrown renewable fuels and blend more, not less, ethanol into the fuel supply.

Meanwhile, Fuels America pointed out that U.S. Energy Department, Argonne National Laboratory and University of Illinois –Chicago studies disprove API’s claims about ethanol and also have proven the benefits of higher fuel blends.

Tom Buis, Growth Energy CEO, countered API’s latest claim by saying that the institute and its allies are attempting Americans hooked on dangerous foreign oil and consumers are paying the price. Americans deserve market access to a less expensive choice at the pump, Buis said. Ethanol choices such as reduce greenhouse emissions and make the air cleaner, he said.

More than 84 percent of the cars on the road are approved to use E15, Buis noted, and despite what API claims, ethanol blends help clear the environment, are higher performing, cost less and directly benefit consumers by providing a choice and savings.

RFA President and CEO Bob Dinneen said he had a feeling of déjà vu. The study, which API commissioned by NERA Economic Consulting (NERA), is nearly identical to a study published by the same group in 2012. "This newest API study contains many of the same fatal flaws that plagued the 2012 study," he said. "This study claims that gas prices will rise by $90 a gallon and diesel will rise by $100 per gallon. It foolishly assumes EPA will not ever utilize its cellulosic waiver authority to partially reduce the advanced and total RFS volume requirements. And it also assumes obligated parties would purchase a RIN credit at any price rather than making modest infrastructure investments to expand renewable fuel distribution."