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EPA grows E15

The EPA widened a crack in the so-called blend wall
Friday, announcing that it has approved the use of gasoline blends of 15%
ethanol for use in light passenger vehicles made for the 2001 model year or
later.  The decision is based on
testing by the Department of Energy that showed no ill effects on newer

“Recently completed testing and data analysis show that
E15 does not harm emissions control equipment in newer cars and light
trucks," said EPA Administrator Lisa P. Jackson. "Wherever sound
science and the law support steps to allow more home-grown fuels in America’s
vehicles, this administration takes those steps." ?

The announcement was welcomed by commodity and farm
groups and lobbyists for the ethanol industry.

The EPA announcement opens up the market for E15 for
about 55% to 60% of cars and pickup trucks currently on the road, said leaders
of Growth Energy, the ethanol trade group that asked EPA in 2009 for a waiver
to the Clean Air Act to allow a blend above the current 10% limit for all cars.

“It’s a huge step forward for our national security,”
said retired General Wesley Clark, co-chair of Growth Energy. The decision will
allow the use of another 7 billion gallons a year of ethanol, he said. The EPA
is mandating the use of almost 14 billion gallons of ethanol this year through
the renewable fuel standard.

Tom Buis, Growth Energy CEO, said his group would like to
see E15 allowed in all cars but acknowledged that he’s not aware of testing by
DOE on older vehicles.

“We are not going to give up until we completely tear
down that blend wall,” Buis said.

Buis wasn’t able to say exactly when E15 will be widely
available to motorists, but he said he thought it would be sooner than the
three-to-five year timeline of some analysts.

EPA still has to issue final rules on how pumps for E15
should be labeled to warn owners of older vehicles against using it. The new
fuel blend will also have to be registered with EPA, he said, and some state
legislatures will have to approve blends above 10% as well.

Already, some independent retailers in the Midwest are
planning to make the shift as soon as they’re allowed.

“We’re planning to put E15 in eight of our 20-strong
chain as soon as the labels have been approved,” said Kent Satrang, CEO and
General Manager of Petro Serve USA, based in Fargo, North Dakota. Satrang plans
to sell E15 at his eight gas stations that have blender pumps, which allow
consumers to buy different levels of ethanol blends.

Satrang joined Buis and Clark at a press conference after
the EPA announcement, along with Todd Becker, CEO of Green Plains Renewable

Becker said that he thinks independent retailers who
aren’t tied in to contracts with major oil companies will offer E15 soon but
that those with oil company contracts will be restricted.

“We don’t control the (pump) islands. Big oil controls a
lot of the independent retailers’ islands,” said Becker, whose Omaha-based
ethanol company ihas also invested in biofuel wholesaling in Houston, Texas.

Another ethanol lobbying group, the Renewable Fuels
Association, welcomed the announcement and said it’s working on speeding up use
of E15.

"EPA's decision today is a sound one, but it doesn't
address the issues that still remain regarding a segmented market place and the
introduction of a new fuel," said RFA president  Dinneen. 
"The RFA will continue to work with EPA and other regulatory bodies
to expand ethanol use beyond even 15%. 
Simultaneously, we will continue our dialogue with lawmakers to develop
and implement sound policies that provide the proper incentives to grow ethanol
use across a variety of blending levels."

RFA spokesman Matt Hartwig gave a rough
estimate Friday of how long it may take to get E15 on the market.

“By later in the year, we think later in the summer or
fall, we may see a few retailers making the decision to offer it.  But we have to clear some of the other
regulatory hurdles before then,” Hartwig said. “We think that once federal
regulations are cleared, retailers in states with current fuel regulations more
conducive to E15 use may see it happen much sooner.  Others will take time. 
Ultimately, it will be up to the retailers.”

Ultimately, wider ethanol use will depend on getting more
blender pumps installed at retailers and getting automakers to turn out more
flex fuel vehicles able to burn E85, Buis said Friday. That might eliminate the
need for EPA to keep raising blend levels allowed in gasoline, he said, as the
nation moves toward using 36 billion gallons of biofuels by 2022.

Getting Congress to support building up that marketing
infrastructure is something that Growth Energy and the RFA agree on, along with
other ethanol and farm groups.

The National Corn Growers Association also was pleased by
EPA’s decision.

“The announcement by EPA this morning is welcome news,”
said NCGA Chairman Darrin Ihnen, a South Dakota corn grower.  “We have
worked closely with EPA during this process and are pleased to see they also
realized what our industry has known for a long time: the use of higher blends
of ethanol in vehicles is safe.”

National Farmers Union president, Roger Johnson, said in
a statement that he  was glad EPA’s
scientific review showed E15 is safe for more than half of the cars on the

“This is a major advancement toward greater energy
independence and reduced greenhouse gas emissions,” Johnson said.








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