In 2014, nine major auto manufacturers produced and sold more than 2.8 million flex-fuel vehicles (FFVs) capable of running on fuel with up to 85 percent ethanol (E85). In fact, one out of every six vehicles sold in the U.S. market that year was an FFV. By 2022, however, FFV production had plummeted to less than 350,000 vehicles, and Ford was the only manufacturer still making FFVs available to everyday consumers.

What caused the collapse in FFV production? Well, the answer can be summed up in three letters: EPA.

Prior to 2016, automakers that made FFVs earned substantial credits that could be used to comply with federal fuel economy and tailpipe emissions standards. The credits were based on the notion that FFVs would operate on lower-carbon E85 half of the time; and extra credit was provided based on E85’s ability to significantly displace petroleum. The combination of these credits provided a powerful incentive that caused FFV production to double between 2010 and 2014.

But the Obama administration did a quick U-turn on FFVs, adopting regulations in 2010 that would phase out the petroleum displacement credit for them by 2016. And beginning that same year, automakers that wanted credit for building FFVs would be required to prove to EPA that those vehicles were actually using E85. At the time, the agency said, “EPA believes the appropriate approach is to ensure that FFV emissions are based on demonstrated emissions performance.”

Oh, the irony.

Today, 13 years later, EPA has proposed regulations that allow electric vehicle manufacturers to assume that those vehicles have zero emissions, even when it is well known that there are significant upstream emissions related to electricity generation and battery manufacturing. In other words, EPA is allowing automakers to simply assume all EVs are entirely free of any carbon impacts, while at the same time requiring FFV makers to prove that those vehicles are using E85. This zero-emissions assumption for EVs provides an overpowering incentive that will effectively force automakers to abandon internal combustion engines in favor of battery-powered vehicles.
Fortunately, a bipartisan duo of senators has recognized the bias and incongruity of EPA’s proposal—and they are doing something about it. In July, Senators Amy Klobuchar (D-MN) and Pete Ricketts (R-NE) introduced the Flex Fuel Fairness Act, a bill that would level the playing field for FFVs by properly recognizing the emissions benefits associated with using E85 flex fuels.

Just as EPA assumes an EV will always use zero-emissions electricity, the Flex Fuel Fairness Act creates a similar assumption that FFVs will always operate on E85—a fuel that reduces lifecycle GHG emissions by 31 percent per mile compared to gasoline today. The bill allows auto manufacturers who produce FFVs to use a tailpipe emissions value that is 31 percent lower than the value for the corresponding non-FFV model. This incentive would strongly encourage automakers to ramp up FFV production—alongside increased EV output—to ensure consumers have more low-carbon vehicle options.

Clearly, the timing is right. Demand for low-carbon E85 has soared in recent years, just as FFV production has been crashing. For example, the sale of E85 in California in 2022 surged 66 percent over 2021 and was more than double the volume sold in 2019. Today, more than 5,700 gas stations offer E85 in the United States, and the fuel typically sells for 20 to 25 percent less than regular gasoline, a price difference that more than makes up for any potential fuel economy loss.

RFA is encouraging all ethanol proponents to call your senators today and ask them to support the Flex Fuel Fairness Act. This innovative legislation would level the playing field for low-carbon vehicle technologies and give American consumers the options they desire—both at the auto dealer lot and at the filling station.

Geoff Cooper
President and CEO
Renewable Fuels Association
202-289-3835
gcooper@ethanolrfa.org

Printed in the 2023 October issue of Ethanol Producer Magazine