Ethanol Blog

LINCOLN, Neb. (DTN) – The same economic conditions that warranted EPA granting a waiver to allow E15 sales to continue last summer are in place this year and in some ways worse, the head of the nation's largest ethanol interest group said in a letter to EPA Administrator Michael Regan on Thursday.

Renewable Fuels Association President and CEO Geoff Cooper asked Regan to grant another waiver if the agency is waiting until 2024 to implement permanent waivers in eight states as part of petitions from those states to EPA.

"Current fuel supply conditions are extreme and unusual, justifying immediate emergency action by EPA to allow summertime sales of E15," Cooper said in the letter.

"Total inventories of gasoline are even lower today than they were at this time a year ago (i.e., when EPA issued a series of emergency waivers to address 'a lack of an 'adequate fuel supply'). We urge EPA to again exercise its waiver authority to allow summertime sales of E15 in conventional gasoline areas to extend supplies and avert potential fuel shortages."

EPA has proposed allowing permanent E15 in Illinois, Iowa, Minnesota, Missouri, Nebraska, Ohio, South Dakota and Wisconsin.

Also, attorneys general in Iowa and Nebraska filed an intent to sue with EPA Administrator Michael Regan if the agency does not change the effective date of granting those petitions from 2024 to 2023. In addition, legislation has been reintroduced in Congress to make E15 sales permanent nationally.

The Clean Air Act allows governors to notify EPA that they wish to reject the use of the 1-psi waiver for E10 in their states. This would result in the application of the same volatility limitation to both E15 and E10 -- essentially putting E10 and E15 on the same footing.

"War in Ukraine continues to disrupt the U.S. fuel supply," Cooper said in the letter.

"Total U.S. gasoline stocks fell to just 229.6 million barrels last week, 5% below year-ago levels and the lowest for this time of year since 2015. Meanwhile, total stocks of crude oil and petroleum products are also down 5% from a year ago and have fallen to a 19-year low for this time of year."

Cooper said market analysts are warning about further tightening of gasoline inventories as summer approaches and the potential for gas prices to hit $5 per gallon.

EPA's decision last year to issue emergency waivers helped avert potential shortages and lowered prices at the pump, according to the RFA letter.

"During the summer of 2022, consumers choosing E15 saved an average of 20 to 30 cents per gallon compared to regular E10 gasoline," Cooper wrote.

"Nationwide, the availability of E15 last summer reduced consumer spending on gasoline by nearly $60 million. Emergency waivers allowing summer sales of E15 would yield even greater economic benefits in 2023, as more retail stations are offering the fuel than at this time last year. In addition, E15 reduces lifecycle greenhouse gas emissions and cuts tailpipe pollution linked to poor air quality. Clearly, it is in the public interest to grant a waiver allowing E15 sales to continue this summer."

Todd Neeley can be reached at todd.neeley@dtn.com

Follow him on Twitter @DTNeeley

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