Blend wall point of contention at EPA hearing

Source: Marc Heller, E&E reporter • Posted: Monday, June 13, 2016

In the fight over renewable fuel mandates, one side wants to strengthen the “blend wall,” while the other is trying to tear it down.

The blend wall of 10 percent ethanol in fuel remained a main point of contention yesterday as U.S. EPA took testimony in Kansas City, Mo., on its renewable fuel standard proposal for 2017. The hearing was webcast.

At issue is whether the United States is ready for fuels that contain more ethanol and whether EPA should be more aggressive in setting levels for biofuels as part of the RFS.

Proponents of ethanol called the blend wall a creation of oil companies and urged the agency to boost renewable fuel beyond the 18.8-billion-gallon level in the proposal.

Boosters also want the administration to be more open to high-ethanol mixes that include more than 15 percent of the biofuel, known as E15, mostly derived from corn.

Selling higher-ethanol blends is not unprecedented, according to the American Coalition for Ethanol, which told EPA that 300 gas stations around the country have already “easily exceeded” the blend wall, selling fuel that’s 85 percent ethanol.

Higher-ethanol fuels such as E15 and E85 are “fuels of dreams,” said John DiMartini, marketing manager at the Andersons Inc., a grain and ethanol dealer, who urged EPA to consider more ambitious targets. “If you set it, they will come.”

In Mercer, Mo., Hometown Fuel Inc. sells E20, E30 and E85 fuels and uses them on its own vehicles and in farm equipment, company President Lori Porter said at the hearing.

“Consumers are demanding ethanol,” said Porter, who called the blend wall a “fictitious level” pushed by oil companies that compete with biofuels.

EPA is proposing to boost renewable fuel blending compared with this year, but the agency still used its waiver authority to fall short of congressional mandates in the 2007 RFS law.

Opponents said that fuel mixes beyond 10 percent would damage engines and that increased corn ethanol use would hurt the environment by encouraging the planting of corn treated with pesticides.

Motorcycling enthusiasts said that their bikes aren’t certified by manufacturers for fuel with more than 10 percent ethanol and that makers void warrantees if such fuel is used.

The director of government relations for the American Motorcyclist Association, Rick Podliska, said his group “remains concerned about the lack of consumer awareness surrounding the limitations of unsafe E15 and the damage it can cause to engines and infrastructure,” and urged a consumer awareness campaign.

The 18.8 billion gallons proposed for 2017 is a slight increase from the 18.1-billion-gallon level set for this year and up from the 16.93 billion gallons for 2015.

Whether EPA boosts the proposed levels will play out over the next few months. The argument over ethanol content in fuel carries on.

In the background are calls for revamping the RFS. Some refiners, including Valero Energy Corp. and HollyFrontier Corp., urged EPA to switch the responsibility for compliance from refiners to blenders, echoing a formal request they have made in challenging the RFS in the U.S. Court of Appeals for the District of Columbia Circuit.