The U.S. Environmental Protection Agency (EPA) has submitted a request to the White House seeking approval for a rule that would permit expanded sales of higher-ethanol gasoline in specific Midwestern states, responding to requests from governors in those regions.
The proposal, initially introduced by the EPA in March, suggests allowing the year-round sale of E15, a gasoline blend containing 15% ethanol, in states including Illinois, Iowa, Minnesota, Missouri, Nebraska, Ohio, South Dakota, and Wisconsin. The move comes after warnings from the oil industry to the Biden administration about potential supply chain disruptions and subsequent increases in gasoline prices.
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The EPA's proposal, now under final review at the White House, carries an effective date of April 28, 2024, for all states involved. Ethanol, primarily derived from domestically produced corn, offers a cost advantage by volume over traditional gasoline and has the potential to lower prices by expanding overall supply.
Current U.S. regulations restrict the summer-time sale of E15 gasoline due to environmental concerns related to smog. The ethanol industry has long advocated for the removal of these restrictions nationwide, asserting that environmental impacts have been exaggerated.
Oil refiners, including HF Sinclair Corp and Phillips 66, have cautioned against a fragmented approval process for E15 sales, citing potential complications in fuel supply logistics and an increased risk of spot shortages.
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While ethanol groups express a preference for a nationwide legislative solution to facilitate expanded E15 sales, the regional approach proposed by the EPA aims to address the specific requests from Midwestern states. The ongoing debate underscores the delicate balance between environmental considerations, economic interests, and the potential impact on fuel prices.
