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Ethanol-free gasoline spared in latest EPA ruling, though its days may be numbered

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Photo by BrotherMagneto.

Despite worries that the Environmental Protection Agency would put an end to ethanol-free gasoline sales with its Renewable Fuels Standard ruling for 2017, the agency permitted E0 a reprieve at the same time it declared its intention to transition the entire nation’s fuel supply to E10 and above.

While the EPA has no say on the exact proportions of E0, E10, E15, E85, and other ethanol-blended fuels that make up the country’s fuel supply, it does set forth the total amounts of ethanol to be blended into the fuel supply, and in its final numbers for 2017, released last week, the agency increased that total amount to 19.28 billion gallons.

Part of the agency’s reasoning for that total amount came from its expectation that demand for ethanol-free gasoline in the coming year would amount to just 200 million gallons, largely driven by recreational boaters. While the EPA made no direct reference to the concerns of old car enthusiasts in its ruling, it did address those concerns in its official response to public comments on its ethanol policies.

“While some vehicle or engine owners other than owners of recreational marine engines may prefer E0, we do not believe that volumes of E0 used by such parties should be included in our determination of the applicable volume requirements for 2017 since they do not have the same particular sensitivity to gasoline blended with ethanol – with the exception of the oldest engines, essentially all vehicles and engines currently in use have been designed to be compatible with E10.”

In addition, the agency rejected arguments that as much as 5.3 billion gallons of ethanol-free gasoline were used in 2015 and that demand for ethanol-free gasoline has not declined over recent years. While the EPA did evaluate scenarios that projected demand of 500 million gallons of ethanol-free gasoline for 2017 (down from its own estimate of 700 million gallons in 2015), it ultimately settled on a figure of 200 million gallons after citing a lack of hard data on how much ethanol-free gasoline has been consumed in recent years.

Boaters – through the National Marine Manufacturers Association – and motorcyclists – through the American Motorcyclists Association – have expressed concern over the last several months that the EPA would reduce the amount of ethanol-free gasoline in the nation’s fuel supply to zero.

However, as the agency pointed out, the 200 million gallon figure does not necessarily limit the nation’s fuel supply to 200 million gallons of ethanol-free gasoline in 2017. More could be sold based on demand as long as the nation’s fuel supply balances out those sales with increased sales of E15 and higher ethanol-blended fuels.

The 200 million gallon figure compares to estimates of 275 million gallons of E85 and 728 million gallons of E15.

Regardless of the amounts of ethanol-free fuel available in 2017, the EPA noted in last week’s ruling that it intends to “continue incentivizing the market to transition from E0 to E10 and other higher level ethanol blends.”

That final figure of 19.28 billion gallons – which surpasses the 18.8 billion gallons that the EPA proposed earlier this year – translates to about 10.7 percent of the nation’s fuel supply. Of that amount, 15 billion gallons will come from “conventional” sources – that is, from corn – thus meeting the standards set by Congress in the Renewable Fuel Standard in 2007. While the Renewable Fuel Standard stipulates total renewable fuel volumes to rise to 36 billion gallons by 2022, it does not call for conventionally sourced ethanol to rise beyond 15 billion gallons after 2017.