US refiners, ethanol groups press EPA on biofuel mandates

08 April 2013 21:03  [Source: ICIS news]

US refiners, ethanol groups press EPA on biofuel mandatesWASHINGTON (ICIS)--US refiners on Monday again urged federal officials to abandon plans to make higher ethanol blended gasoline available to consumers, warning that the action could cause widespread economic damage.

The American Fuel & Petrochemical Manufacturers (AFPM) filed formal comments to the Environmental Protection Agency (EPA), arguing that EPA’s proposed ethanol consumption mandates for this year “are divorced from reality”.

As in earlier complaints about the agency’s annual renewable fuel standard (RFS) for ethanol consumption, AFPM targeted plans to allow use of gasoline blends that contain 15% ethanol, or E-15. 

The current allowable ethanol blend in gasolines is 10%, E-10.

The EPA and ethanol producers argue that E-15 may be safely used in any automobile manufactured in model year 2001 or later. 

But AFPM and a coalition of other stakeholders, such as auto and engine manufacturers, contend that E-15 can and will cause damage to engines and fuelling infrastructure, and could open refiners and gasoline-powered equipment manufacturers to broad liability claims from consumers.

AFPM president Charles Drevna also was critical of the EPA’s plan to mandate US consumption of 14m gallons of cellulosic ethanol this year, when the Energy Department estimates that only 5m gallons of cellulosic ethanol will be available this year.

Refiners and fuel blenders who fail to use the mandated volumes of cellulosic ethanol are required to pay a penalty to the EPA.  A federal court recently invalidated the EPA's cellulosic ethanol mandate.

Drevna charged that the EPA has refused to use authority granted under the Energy Independence and Security Act (EISA) of 2007 to adjust ethanol mandate levels to market conditions.  The EISA and an earlier energy bill established the RFS ethanol mandates.

The EPA, said Drevna, “continues to set cellulosic biofuel standards that are divorced from reality”.

But the Renewable Fuels Association (RFA), a leading US ethanol industry trade group, told the EPA in its comments that even if adjusted, the cellulosic ethanol mandate should be continued in order to encourage production growth and on-going investments in the fuel.

The RFA also argued that the EPA must maintain its mandate for use of E-15 ethanol blends because the goals set by Congress in the EISA for biofuel consumption cannot be waived unless they constitute a severe economic threat to states or the country as a whole, or if there is inadequate domestic supply of ethanol.

The RFA urged the EPA to act quickly to make its 2013 RFS mandate final so that industry can adjust to the new levels.

A final EPA mandate decision is expected sometime in mid-year.

Paul Hodges studies key influencers shaping the chemical industry in Chemicals and the Economy

By: Joe Kamalick
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