EPA responds to Midwest petitions seeking year-round E15 sales

• 

The U.S. EPA on March 1 released a proposed rule that aims to allow year-round E15 sales in Illinois, Iowa, Minnesota, Missouri, Nebraska, Ohio, South Dakota and Wisconsin starting in 2024. A public comment period on the proposed rule will be open for 45 days.

The agency issued the proposed rule in response to a petition filed by several Midwestern governors in April 2022 requesting that the EPA remove the 1-psi Reid vapor pressure (RVP) waiver for summer gasoline-ethanol blended fuels, which would effectively allow E15 to be sold year-round within their states.

E15 has been available for use in many non-flex fuel vehicles for more than a decade. The U.S. EPA first granted a partial waiver allowing E15 to be used in model year (MY) 2007 and newer light-duty vehicles in 2010. The agency expanded that waiver to include MY 2001 and newer vehicles the following year. The fuel blend, however, could not be sold in most markets during the summer driving season, from June 1 through Sept. 15. A June 2019 rulemaking changed that, extending the 9-psi RVP waiver to E15 and allowing the fuel to be sold during the summer driving season. The EPA’s rule was challenged by oil groups and in June 2021 the D.C. Circuit Court of Appeals vacated the portion of the June 2019 related to E15, overturning the ability of most fuel retailers to sell E15 during the summer driving season.  

The Biden administration temporarily reinstated the ability to sell E15 during the summer driving season in 2022 via an emergency waiver. That emergency waiver, announced in April 2022, was issued as part of the administration’s effort to reduce high fuel prices caused, in part, by market impacts associated with Russia’s invasion of Ukraine. 

The emergency waiver applied to the summer 2022 driving season only. The April 2022 petitions filed by the eight Midwestern governors aimed to create a permanent solution allowing for year-round sales of E15 within their states, starting with the 2023 summer driving season. According to the EPA, the agency also received multiple petitions from stakeholders asking the agency to delay the effective date to summer 2024.

The proposed rule issued by the EPA includes an effective date for all eight impacted states of April 28, 2024. The rulemaking also proposes a regulatory process by which a state may request to reinstate the 1-psi waiver.

Information included in the rulemaking indicates that the governors of Kansas and North Dakota also filed requests with the EPA seeking removal of the 1-psi RVP waiver, but later rescinded those requests.

A 45-day public comment period on the proposed rule is scheduled to begin following publication of the proposed rule in the Federal Register. According to the EPA, a virtual public hearing for the proposed rule will be held in late March or early April.

The Renewable Fuels Association applauded the EPA for taking action on the governors’ petitions, but criticized the delay in implementing the requests. “Today’s proposal offers both good news and bad news for consumers, fuel retailers, ethanol producers, and farmers,” said Geoff Cooper, president and CEO of the RFA. “While we’re glad to see EPA is finally taking action to approve the Governors’ petition, we’re frustrated and disappointed that the agency is proposing to kick the can on implementation until 2024.

“There is simply no justification for further delaying this action, which is already months overdue,” Cooper continued. “By law, EPA should have finalized approval of the Governors’ petition more than seven months ago, which would have given the marketplace more than enough time to adjust and prepare for implementation this summer. But instead, under pressure from the oil industry, the White House ignored a statutory deadline, sat on the proposal for months on end, and slow-rolled Governors who acted in good faith to ensure consumers would have the ability to chooser lower-cost E15 all year long.  And now, because of the administration’s unnecessary foot-dragging, consumers could lose access to the most affordable fuel at the pump three months from now.

“We urge EPA to reconsider its proposal to delay implementation,” Cooper added. “There is still time for the agency to finalize the regulation—or to use other regulatory authority—to allow E15 sales to continue this summer.”

The American Coalition for Ethanol said urgent action is needed for the 2023 summer driving season. “While ACE appreciates this step for 2024, EPA made multiple public promises these Midwest states would be approved for E15 market access in time for the 2023 summer driving season,” said Brian Jennings, CEO of ACE. “Now, the Administration appears to be caving to refiner crocodile tears by kicking the can to 2024 instead. This delay means consumers in conventional gasoline areas of the country will be forced to pay more at the pump this year and retailers who want to offer lower cost E15 to their customers will be penalized.”

“EPA’s proposed delay makes a more permanent, nationwide E15 solution even more critical, and ACE will remain engaged with Congress and our industry partners on the re-introduction of the Consumer and Fuel Retailer Choice Act, legislation to permanently allow E15 across the entire nation,” Jennings added. “We will make this legislation a major priority for our Hill visits during the ACE fly-in March 29 and 30.”

The Iowa Renewable Fuels Association said the delay in implementing year-round E15 availability will hurt fuel retailers and consumers. “It is unconscionable for me to think that this summer, Midwestern drivers and fuel retailers will be the ones to pay the price for the illegal delay by the Biden EPA to finalize these rules,” said Monte Shaw, executive director of the IRFA. “The governors’ authority is not in question. The air quality science is not in question. There is no question the EPA failed to meet the statutory deadline. Now they are using their own tardiness to justify putting off the E15 fix until 2024, leaving Midwest consumers to pay 15 cents per gallon or more than necessary.”

“We are not done fighting for 2023,” Shaw continued. “EPA promised the solution would be in place for 2023 and we intend to hold them to that. We urge the governors and the attorneys general to defend their rights under the Clean Air Act.”

Ethanol producer Poet applauded the leadership of Midwest governors in pushing for year-round E15, but criticized the delayed implementation date proposed by the EPA. "Poet applauds the determined leadership of our Midwest governors and their efforts to ensure year-round access to fuel savings with E15," said Joshua Shields, Poet’s senior vice president of government affairs and communications. "Every American deserves the freedom to fill up with homegrown fuel blends, like E15, that reduce emissions, lower gas prices, and grow jobs. We are fortunate to have strong E15 champions like Governors Reynolds, DeWine, Evers, Noem, Parson, Pillen, Pritzker, Walz, and former Governor Ricketts, who understand the full value of unlocking E15." 

"EPA's proposed rule reflects an important step toward continuous access to E15 in many of the largest fuel markets across the Midwest, and we greatly appreciate Administrator Regan's commitment to seeing it through," added Shields. "The lack of near-term certainty underscores the urgent need to ensure E15 sales are not interrupted. E15 savings represented an economic lifeline for many last summer, and the Biden Administration should make it clear today that E15 will be available to alleviate price spikes this summer when hardworking Americans need it most."

Growth Energy is also stressing the need to allow E15 sales this summer. “We are pleased to see EPA make progress on the request submitted last year by Governors Reynolds, Evers, Noem, Pritzker, Walz, DeWine, and Parson, as well as former Governor Ricketts and with the support of Nebraska Governor Pillen,” said Emily Skor, CEO of Growth Energy. “We are grateful to EPA Administrator Regan for his steadfast efforts to preserve access to affordable, domestic biofuels, but we’re disappointed that the EPA’s proposal doesn’t provide a fix for 2023 and the coming summer driving season.

“There’s no denying that the simplest, best solution to unnecessary and outdated restrictions on year-round access to E15 is a permanent, federal legislative fix. American families need the cost savings that E15 provides,” Skor added. “Ethanol producers need a robust fuel market to reliably make new investments that create jobs and lower carbon emissions. Retailers need marketplace certainty to fully commit to offering this fuel choice to their customers. Securing parity between E10 and E15 nationwide would address all three of these concerns.

“American drivers have been able to purchase E15 every summer since 2019, and this summer should be no different,” she said. “EPA can ensure that access continues in 2023, and should take whatever steps are necessary to do so, including through the use of an emergency waiver.

“EPA has nothing to lose by providing such a fix, and the country has everything to gain. First and foremost, we need E15 in 2023 so consumers can save money every time they fuel up at the pump. Drivers saved an average of 16 cents per gallon this past summer thanks to E15 – and many saved even more, up to nearly a dollar per gallon. Working families don’t want to lose access to their favorite lower-carbon, lower-cost option on June 1.

“Additionally, the conditions that drove EPA to issue its first emergency waiver in summer 2022 are still impacting fuel markets. The war in Ukraine continues to affect the global supply chain and international oil prices. Granting a waiver or finding some other solution for this year would again decrease volatility and provide greater certainty for consumers, retailers, and ethanol producers.

“Finally, failing to offer a fix for 2023 would be a significant setback for E15 availability,” Skor said. “While we appreciate parts of EPA’s proposal, without similar treatment for E15 this year, the benefits of such treatment could be undermined or negated completely as retailers stop selling this lower-cost, lower-carbon fuel option.

“EPA should act swiftly to avoid these negative impacts and find a way to give American families access to the same savings this year that they came to rely on last year. Growth Energy will continue to work alongside our champions to work toward an immediate and permanent place at the pump for lower-cost ethanol blends.”

Additional information, including a full copy of the proposed rule, is available on the EPA website.