When I came to ACE from the world of petroleum marketing in 2000, I was surprised to learn the ethanol industry didn’t necessarily see the U.S. Environmental Protection Agency as its friend. I mean, ethanol use got its original boost from the Clean Air Act, and EPA oversees that, right? And ethanol is good for the environment, right? Maybe ethanol folks were just ... needy?

Over the years, however, I began to understand, and learned a catchphrase the old-timers used when they talked about disappointing decisions and actions made by EPA: “the ‘E’ is silent.”

Nothing hammered home the disconnect between EPA and the first word in its name more than the past decade of trying to make E15 a mainstream fuel. And maybe it’s because I’m one of the old-timers now and have forgotten more egregious actions in the past, but I can’t recall a time when EPA’s cozy partnership with the oil industry—the world’s worst polluters—was more on display than its recent proposed rule responding to eight Midwest Governors’ requests to remove the 1-pound Reid vapor pressure (RVP) waiver from all fuels during the high-ozone season to facilitate year-round blending of E15.

In the rule, EPA acknowledges that upon notification by the governor of a state, and with required documentation, the EPA administrator “shall, by regulation, apply the volatility limit.” Simple and straightforward. And yet, EPA waited almost a year to say they’ll obey the law ... later.

EPA also acknowledges the “shall” gives them “limited if any discretion [to] consider other issues such as economic impacts of removing the 1-psi waiver.” Yet, immediately after pointing out those facts, EPA limits itself to about 20 pages of consideration of the economic impacts of removing the 1-psi waiver. They use the codename “adequate supply” instead of economic impact, but the “impacts” examined are unsurprisingly similar to the usual boatload of red herring refiners dump on every rule ever proposed to expand E15 availability. EPA’s conclusions also echo the oil industry’s tired warnings of “it’s too difficult” and “prices will rise astronomically.” Unfortunately, the oil guys can make that second part true any time they want.

Any shred of doubt that the “E” is silent and EPA looks out for its oil BFFs first, was removed for me when, in the rule, EPA lamented refiners’ “lost opportunity cost for having to sell the removed butane at market prices for butane instead of blending it into high value summer gasoline.” EPA defending more butane in gas? What?

While EPA examined the real and imaginary objections typically offered by refiners, it conspicuously gave zero consideration to the economic impact its “gap year” would have on E15 retailers and consumers. Retailers who have offered E15 and consumers who purchased E15 year-round in 2020, 2021, 2022, and who will buy it again in 2024 would be forced to switch for three and a half months because EPA dragged its feet on the governors’ requests. Retailers would have increased costs from switching fuels in their tanks twice, service calls to adjust blender pumps twice, and changing out pump decals twice. Consumers who use E15 because it saves 5 to 15 cents versus E10, and is 45 to 95 cents cheaper than “clear” gas, will have to spend more for fuel they don’t want during the busiest time of the year.

EPA should show retailers, consumers, and the environment a fraction of the concern they’ve shown for refiners, by urging the Administration to grant an emergency 1-psi RVP waiver for blends above 10 percent ethanol in 2023. It's the least EPA could do (which is traditionally what they’ve done for ethanol).

Ron Lamberty
Chief Marketing Officer,
American Coalition for Ethanol
rlamberty@ethanol.org

PRINTED IN 2023 MAY EPM