Corn-state senators seek new vehicle for ethanol measure

Source: Marc Heller, E&E News reporter • Posted: Thursday, May 11, 2017

A measure to expand sales of higher-ethanol fuel year-round has a good chance of passing the Senate this year, Sen. John Hoeven (R-N.D.) said yesterday.

Hoeven, chairman of the Senate Agriculture Appropriations Subcommittee, said he believes the ethanol issue can advance, even with yesterday’s collapse of a methane regulation bill that corn-state senators were holding up to gain leverage on the corn-based fuel.

The failure of the methane bill on a 49-51 vote spoiled a narrative that’s been running through the halls of the Capitol in recent days: that leaders could ensure passage by promising senators such as Chuck Grassley (R-Iowa) and John Thune (R-S.D.) to relax seasonal restrictions on sales of E15 fuel (Greenwire, May 10).

In the end, senators pushing E15 didn’t play a role in the outcome. Three other Republicans — Sens. Susan Collins of Maine, Lindsey Graham of South Carolina and John McCain of Arizona — sided with Democrats who opposed moving the methane measure forward.

“We’ll try to do it on a separate bill,” said Hoeven, who supports the ethanol change but was also pushing the proposal to kill the Obama administration’s methane rules on public lands.

“There’s no reason not to do it, so I think we have a pretty good shot to get it,” Hoeven said of easing E15 restrictions.

Hoeven is also a member of the Agriculture Committee and the Energy and Natural Resources Committee, which handle renewable fuel issues.

At issue are rules that limit sales of certain fuel in summer, when evaporation can contribute to ozone pollution. Fuel that’s 10 percent ethanol isn’t subject to those restrictions, but E15 — which is 15 percent ethanol, 85 percent petroleum — is from June to September.

Hoeven and other ethanol supporters say the limitation doesn’t make sense because E15 is no more volatile than E10.

Hoeven didn’t say which legislation could provide a path for the ethanol provision but that it should be related to energy or renewable fuels, for instance — a condition that leaders decided the bill on methane rules didn’t meet.

Grassley, whose state leads the nation in ethanol production, is looking for changes in the law rather than administrative fixes or a hearing, a spokeswoman said.

Ethanol industry groups say the E15 rules are their top policy priority. Forcing retailers to take away E15 and then restore it in the fall discourages retailers from offering it in the first place, they say.

Absent congressional action, U.S. EPA could make a change administratively, the Renewable Fuels Association has said. EPA Administrator Scott Pruitt appeared to endorse the concept last week but said he wasn’t sure the law permits a change without congressional action (Greenwire, May 4).

E15 sales gained visibility earlier this year when industry groups speculated that the Trump administration was considering endorsing the E15 waiver in exchange for a separate change in the renewable fuel standard that would benefit oil and gas refineries — an idea pushed by the investor Carl Icahn, an informal adviser to President Trump (Greenwire, Feb. 28).

The Renewable Fuels Association’s president, Bob Dinneen, had described that supposed deal in news reports, setting off a wave of opposition from other renewable fuel groups.

The prospect of deals negotiated in secret has provided fodder for ethanol critics, including the National Marine Manufacturers Association, to fight expanded E15 offerings.

“Especially timely, as a backroom deal is being pushed in the Senate by pro-corn legislators that would overturn a rule on methane emissions in exchange for the ability to push more E15 (15 percent ethanol) into gas pumps nationwide,” the NMMA said in an email to reporters earlier this week.

The NMMA complained that higher-ethanol fuel can harm boats, which EPA hasn’t approved for blends richer than 10 percent ethanol. The RFA launched an ad campaign this week asserting that E10 can be beneficial for boats and downplaying the likelihood of misfueling with E15.

An RFA spokesman had no comment yesterday on the prospects for advancing the E15 issue in the Senate.