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July 2, 2021
The courts dealt another blow to the biofuels industry with the D.C. Circuit Court of Appeals reversing a 2019 rule by the Environmental Protection Agency that allowed the year-round sale of 15% ethanol blends or E15. The rule made it easier for E15 to be sold during the summer driving season in conventional gasoline markets which make up roughly two-thirds of all gasoline sold.
In June 2019, EPA issued its final rule extending the Reid Vapor Pressure volatility waiver to E15 and found that E15 is substantially similar to E10 certification fuel, allowing its introduction into commerce by fuel manufacturers without the need for a separate E15 waiver. These actions allowed for the sale of E15 fuels year-round.
Oil refiners soon challenged the rulemaking in the D.C. Circuit Court of Appeals in the case American Fuel & Petrochemical Manufacturers, et al. vs. EPA
AFPM President and CEO Chet Thompson, says, “We are glad the Court unanimously found that EPA lacks the authority to grant an RVP waiver to fuel containing more than 10% ethanol, consistent with how EPA interpreted its authority for nearly 30 years prior. There is no ambiguity in statute and the previous administration’s reinterpretation overstepped the will of Congress.”
Growth Energy, the Renewable Fuels Association and the National Corn Growers Association were intervenors on behalf of EPA in the case. In their August 2020 brief, the organizations provided strong support for EPA’s position that parity in RVP regulations for E10 and E15 is consistent with the provisions of the Clean Air Act and the congressional intent behind those provisions. The organizations further pointed out that extending the volatility waiver from E10 to E15 is appropriate because the volatility of the fuel actually decreases as more ethanol is added into gasoline beyond E10.
“We disagree with the court’s decision to reject EPA’s move to expand the RVP waiver to include E15, a decision that could deprive American drivers of lower carbon options at the pump and would result in more carbon in the atmosphere,” the groups note in a joint statement.
Iowa Renewable Fuels Association Executive Director Monte Shaw says, “It is still our view that the law allowing an RVP waiver for blends containing 10% ethanol can and should be applied to E15, which does contain 10% ethanol, and a little more. There is no scientific or environmentally sound reason to erect arbitrary barriers to the sale of E15 in the summer months, which has lower combined evaporative and tailpipe emission than either E0 or E10. Today’s decision really turned this section of the Clean Air Act on its head.”
Growth Energy, RFA and NCGA say they are working to ensure the continuity of E15 sales through the 2021 summer season and beyond. This decision could impact summertime sales across all non-reformulated gas areas where nearly two-thirds of retail sites offering E15 currently do business.
“If E15 in those markets were to end, summertime E15 sales would fall by 90%,” the groups warn.
Shaw says he’s confident E15 sales during the summer’s driving season will not be impacted. “The key will be to find a solution by June of 2022 to ensure the rug is not pulled out from under fuel retailers across the country who have added E15 to their stations, banking on the certainty EPA provided to offer the fuel all year,” he says.
Growth Energy, RFA and NCGA note, “We are pursuing all available options and will work with the administration and our congressional champions to ensure that we have a solution in place before the 2022 driving season.”
“It is painfully ironic that last week we lost an important RFS lawsuit when the Supreme Court found that agencies could broadly construe the word ‘extension,” while today the D.C. Circuit Court rules against us because an agency did not employ the most narrow and limiting definition of the word ‘contains.’ Perhaps last week’s Supreme Court loss sowed the seeds of this decision’s future reversal.”
Policy editor, Farm Futures
Jacqui Fatka grew up on a diversified livestock and grain farm in southwest Iowa and graduated from Iowa State University with a bachelor’s degree in journalism and mass communications, with a minor in agriculture education, in 2003. She’s been writing for agricultural audiences ever since. In college, she interned with Wallaces Farmer and cultivated her love of ag policy during an internship with the Iowa Pork Producers Association, working in Sen. Chuck Grassley’s Capitol Hill press office. In 2003, she started full time for Farm Progress companies’ state and regional publications as the e-content editor, and became Farm Futures’ policy editor in 2004. A few years later, she began covering grain and biofuels markets for the weekly newspaper Feedstuffs. As the current policy editor for Farm Progress, she covers the ongoing developments in ag policy, trade, regulations and court rulings. Fatka also serves as the interim executive secretary-treasurer for the North American Agricultural Journalists. She lives on a small acreage in central Ohio with her husband and three children.
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