EPA Approves the use of E30 in Nebraska Fleet Demonstration Poised to Reduce Costs, Pollution
On Oct. 19, 2022, the U.S. Environmental Protection Agency (EPA) approved the continuation of ground-breaking research being done in Nebraska on the long-term adaptability and feasibility of E30 fuel. Results of the State’s initial pilot program, launched in 2019, showed that E30 is safe and reliable fuel for use in conventional vehicles. Under EPA current guidelines, only flex fuel vehicles can use ethanol blends higher than E15, but the State intends to underscore its initial findings in order to support regulatory change to make E30 accessible to all drivers. The second phase of the E30 demonstration began in fall 2022 and includes up to 825 State vehicles. While further demonstrating the safety and reliability of E30, the State will also significantly reduce its fuel costs and carbon footprint through the program.
E15 Year-Round Update
Senators Amy Klobuchar (D-Minn.) and Deb Fischer (R-Neb.) and Representatives Angie Craig (D-Minn.) and Adrian Smith (D-Neb.) introduced the Consumer and Fuel Retailer Choice Act of 2022 before the end of the year. This bipartisan, bicameral legislation clarifies E15 should be allowed for sale year-round by extending the 1-psi Reid vapor pressure (RVP) waiver to fuel blends containing gasoline and over 10 percent ethanol.
Efforts were made to include the bill in a year-end package, including the American Coalition for Ethanol joining the American Petroleum Institute (API) and over 250 groups and companies in a letter to Congressional leaders calling on support for the legislation. Unfortunately, bill text wasn’t included, and Congress will continue to work on this legislative effort in 2023.
Meanwhile, the White House's Office of Management and Budget (OMB) has begun reviewing EPA's proposed response to a request from seven Midwest states to allow E15 to receive the same treatment as E10 in their states. EPA's proposal, which was sent to OMB in early December, comes in response to a late April request from several governors under Section 211(h) of the Clean Air Act that effectively requires the agency to issue regulations capping the volatility limit of both fuels at 9-psi during the summer driving season. On Dec. 21, the Governor of Missouri also petitioned EPA to allow E15 year-round in the state.
Some refining interests, including API, have concerns over the governors’ request and have thus joined the ethanol industry in supporting federal legislation that would lift RVP restrictions on E15 across the U.S. and make the governors' request unnecessary.
EPA issues RFS RVOs for 2023-2025
The U.S. Environmental Protection Agency (EPA) issued proposed multi-year Renewable Volume Obligations (RVOs) for the 2023-2025 Renewable Fuel Standard (RFS) compliance years. The proposal also implements the remaining 250 million gallons in remanded volumes by the DC Circuit Court in 2017.
“This proposed rule is a critical opportunity for EPA to leverage the greenhouse gas reducing benefits of increasing biofuel blending targets by getting the RFS back on track, and we’re pleased the Agency is taking steps in the right direction by setting conventional biofuel blending at 15 billion gallons or more for 2023 through 2025 on paper, in addition to including the 250 million gallons of supplemental volume to carry out the 2017 DC Circuit Court order,” said ACE CEO Brian Jennings. “Multi-year targets help provide clarity the market needs to lean into climate benefiting transportation fuels such as ethanol. The Inflation Reduction Act is poised to boost investments in clean fuel technologies that support the Agency increasing the use of clean fuels like ethanol through RFS targets moving forward.”
ACE Provides Feedback on the Inflation Reduction Act
The American Coalition for Ethanol (ACE) has been providing feedback on how biofuel provisions included in the Inflation Reduction Act (IRA) should be implemented since it’s been introduced. In written comments submitted in November, ACE CMO Ron Lamberty utilized his fuel retailing expertise and input from retailers to share feedback on implementation of funds for biofuel infrastructure under the Inflation Reduction Act (IRA). Section 22003 of the IRA provides $500 million in grants for infrastructure for blending, storing, supplying, or distributing biofuels and may provide a federal share at up to 75% of the total project cost. This funding builds on previous rounds of funding under the U.S. Department of Agriculture’s Higher Blends Infrastructure Incentive Program (HBIIP), which closed its application window for the latest round of funds November 21, 2022.
In December, ACE CEO Brian Jennings submitted feedback to the Internal Revenue Service (IRS) request for comment on implementation of the new clean fuel tax credit (§45Z) contained in the IRA. Jennings’ comments to the IRS highlight ACE’s steadfast involvement in how the U.S. ethanol industry and farmers can further contribute to GHG reduction goals through policy development and real-world validation of lifecycle GHG benefits of agriculture practices at scale.
Jonathon Lehman of Cultivating Conservation also led a response from ACE in December to the Natural Resource Conservation Services’ request for public input on IRA funding for conservation programs to spur farmer adoption of climate-smart practices.
ACE, along with Christianson PLLP, hosted part one of a webinar series on December 14 to review the important new provisions of this legislation. You can watch the recording of the webinar at ethanol.org/events/webinar/. Stay tuned for more details on this series.
ACE Thanks Congress and President Biden for Swift Action to Avert Rail Strike
Following approval in both the U.S. Senate and House of Representatives, President Biden signed into law legislation adopting the terms of a contract negotiated among freight railroads and most of their unions in September, ahead of the Dec. 9 deadline to reach an agreement before the labor union workers promised to strike.
“The American Coalition for Ethanol thanks President Biden for pressing Congress to pass legislation that resolves the rail dispute, as a strike would have had a domino effect on our industry,” said Brian Jennings, American Coalition for Ethanol (ACE) CEO. “The quick action by the Administration and Congress helps keep ethanol moving to the marketplace, and we’re grateful as our members heavily rely on an efficient and timely rail system.”
