Ethanol Backers Say Higher Blends Would Reduce Air Toxics

Source: By Renee Schoof, Bloomberg BNA • Posted: Tuesday, February 2, 2016

Jan. 28 — A group of farm-state governors and some advocates for clean energy are pressing the Environmental Protection Agency to get tougher on toxic air pollution from motor vehicles in a way that could lead to a bigger market for ethanol.

The Governors’ Biofuels Coalition, a group of 24 governors chaired by Missouri Gov. Jay Nixon (D), said earlier this month that its advocacy for ethanol this year would include “asking EPA to enforce Section 202 of the Clean Air Act to limit aromatics and open the market for ethanol as a source of clean octane.”

Higher octane fuels are in demand for development of the cleaner, more efficient vehicle engines of the future. More ethanol is one way to increase octane, and if the arguments of its supporters prevailed and barriers fell, demand for ethanol could increase. Ethanol backers are using a strategy of attacking hydrocarbon aromatics for their contribution to mobile source air toxics.

“The agency is violating its obligation under the Clean Air Act,” Adam Gustafson, an attorney with Boyden Gray and Associates, told Bloomberg BNA. Under the law’s Section 202(l), “the agency is required to reassess what air toxic reductions are achievable or will be achievable in the future and to regulate accordingly. It hasn’t done that yet,” said Gustafson, who has represented groups in litigation against the EPA over the issue. The governors’ coalition referred questions about its work to him.

Most gasoline sold today is a blend of 10 percent ethanol. The oil and gas industry wants ethanol limited to just under 10 percent of the fuel supply and rejects the idea of more ethanol for better octane.

“High ethanol blends are not compatible with most cars on the road today, and they could put American consumers and their vehicles at risk,” the American Petroleum Institute said in an e-mail to Bloomberg BNA. “Consumers have shown they have little to no interest in purchasing increasing amounts of high ethanol fuels. Consumers’ interests should come ahead of ethanol interests.”

EPA Regulation of Mobile Source Air Toxics

The EPA rejected criticism that it was failing to enforce the air law’s requirements to control hazardous pollutants from vehicles and fuels. An agency spokeswoman told Bloomberg BNA that it did so most recently in a rule that was finalized in 2007, which required reductions of benzene, one of the most potent aromatic compounds in gasoline and a known carcinogen. Aromatics, according to the EPA, are a type of hydrocarbon, some of which are toxic, that are sometimes added to gasoline to increase octane.

The agency also has taken other steps to reduce emissions of mobile air toxics, including aromatic hydrocarbons, such as finalizing Tier 3 vehicle emissions and fuel standards in 2014, the spokeswoman said. The standards are expected to reduce benzene by 26 percent by 2030.

The health risks from toxic air pollution from vehicles include cancer, neurological and cardiovascular damage, harm to the liver and kidneys, and effects on respiratory, immune and reproductive systems.

The Energy Future Coalition, a clean energy advocacy group, wants the EPA to go further and eliminate aromatic hydrocarbons from motor fuels.

The coalition also has argued that a mid-level blend of ethanol such as E30 (30 percent ethanol, 70 percent gasoline) would be a cleaner octane-boosting alternative.

E30 ‘A Solution.’

“We think E30 is the solution, or at least a solution, because it simultaneously achieves a lot of these reductions that we’re talking about and at the same time improves vehicle efficiency, which is itself a pollution reducer,” said Gustafson, who has represented the group in litigation.

The EPA, however, has not approved E30 as a certification fuel for new vehicles’ emissions testing.

The Urban Air Initiative and the Energy Future Coalition asked the EPA to make E30 a certification fuel as part of its 2013 Tier 3 Motor Vehicle Emissions and Fuel Standards ruling. In their comments when the standards were proposed, the groups argued that E30 would enable more efficient engine design and was needed to comply with the agency’s obligation to regulate mobile source air toxics.

After the EPA didn’t certify E30 in the rule, the groups sued the agency, arguing that its requirement that test fuels be commercially available was impossible for alternative fuel producers to meet. The U.S. Court of Appeals for the District of Columbia Circuit upheld the EPA’s policy (Energy Future Coal. v. EPA, D.C. Cir., No. 14-1123, 7/14/15 ); (134 ECR, 7/14/15).

The next step to try to compel the EPA to tighten regulations on mobile source air toxics would be to file a petition for a rulemaking, Gustafson said. That hasn’t happened yet, “but it’s certainly been considered,” he said.

Market for Ethanol

U.S. ethanol groups have long argued that higher blends would open bigger markets for corn ethanol.

A September report by the National Renewable Energy Laboratory said that more ethanol is produced in the U.S. than can be blended into gasoline at the standard 10 percent ethanol level. High-octane ethanol blends containing 20 percent to 40 percent ethanol are being “extensively studied” as fuels that would enable the design of engines that get better performance and fuel economy and produce fewer emissions, the report said. It added that these fuels “could enable dramatic growth in the U.S. ethanol industry” if barriers are overcome and higher blends of ethanol are adopted by the market.

Pro-ethanol group Growth Energy has told the EPA and California air authorities that using more ethanol reduces the need for hydrocarbon aromatics, spokesman Michael Frohlich told Bloomberg BNA.

Jim Lane, editor and publisher of Biofuels Digest, wrote in Jan. 25 online article“Octane’s Liquid Diamonds: The Secret Value of Ethanol” that given low oil prices, high-octane blendstocks from refineries are cheaper than ethanol. But, he added, “ethanol has regulatory compliance value.”

Concerns About E30

Jonathan Lewis, senior counsel with the Clean Air Task Force, told Bloomberg BNA that the lifecycle greenhouse gas emissions of ethanol are higher than from gasoline. On other pollutants, “it’s a trickier question to sort out,” with some studies showing ethanol better compared to gasoline for some emissions and worse on others, Lewis said.

Any environmental benefits from fewer air toxics with higher ethanol blends, he said, “is almost certainly going to be offset by the negative impacts ethanol has on other environmental factors, including climate change.”

Bill Becker, executive director of the National Association of Clean Air Agencies, told Bloomberg BNA that the EPA’s National Air Toxics Assessment regularly shows unacceptably high levels of air toxics in all areas of the country.

“The Clean Air Act has a very important air toxics program for vehicles and stationary sources, but it’s not enough,” Becker said. “The issue isn’t lack of enforcement but that the program could be expanded.” He said the ethanol industry is using that issue to try to promote its product, but that ethanol use is responsible for other conventional air pollution, including nitrogen oxides.

“The ethanol industry’s hands aren’t entirely clean, either, in that higher levels of ethanol, above E10, according to the EPA are increasing nitrogen oxide emissions on average by 7 percent,” Becker said. “And that’s a very important and serious air pollutant contributing to smog, fine particle pollution, visibility impairment and eutrophication (increase of nutrients such as phosphates and nitrogen) of waterways.”

Gustafson said the EPA’s motor vehicle emission model, Motor Vehicle Emission Simulator, or MOVES2014 was inaccurate in the way it tested ethanol.

EPA Model Questioned

The Energy Future Coalition, Urban Air Initiative and the states of Kansas and Nebraska filed a lawsuit against the EPA challenging the model (Kansas v. EPA, D.C. Cir., No. 14-1268, brief filed 07/02/15); (129 ECR, 7/7/15).

Petitioners argued in a brief that the model was so flawed that its estimates about ethanol reflected “the opposite of what happens in reality.” The model associates higher ethanol content with increased emissions of nitrogen oxides and volatile organic compounds, the two main precursors of ground-level ozone, fine particulates (PM2.5), sulfur dioxide (SO2) and other pollutants, the brief said, adding that actually blending ethanol into fuel has been shown to reduce emissions of criteria pollutants, precursors and other air toxics.

The petitioners also made a case on a procedural ground, saying the EPA did not provide a required public notice and comment period. The EPA in its brief defended the model and said the litigation should be dismissed because the changes to MOVES2014 didn’t constitute a final agency action under the Clean Air Act. Oral arguments are scheduled Feb. 11 in the U.S. Court of Appeals for the District of Columbia Circuit (17 ECR, 1/27/16).