FTC Finalizes Ethanol Labels

Source: By CSP Daily News • Posted: Thursday, January 21, 2016

WASHINGTON — On Jan. 14, the U.S. Federal Trade Commission (FTC) published in The Federal Register its final amendments to its Rule for Automotive Fuel Ratings, Certification & Posting by adopting rating, certification and labeling requirements for certain ethanol-gasoline blends.

The final amendments establish specific rating and certification requirements for ethanol blends with ethanol content above 10% to a maximum of 83% and modify the ethanol fuel labeling to permit a single pump label for high-level blends.

The final amendments adopt the proposed “Use Only in Flex-Fuel Vehicles/May Harm Other Engines” language, but modify the proposed ethanol percentage disclosures. Specifically, retailers must post labels with exact ethanol concentrations or round to the nearest multiple of 10 for mid-level blends. For high-level blends, however, they may post the exact concentration, round to the nearest multiple of 10 or label the fuel as “51% to 83% Ethanol.”

The amendments will go into effect on July 14, 2016.

“The amendments further the rule’s goal of helping purchasers identify the correct fuel for their vehicles,” the FTC said.

The FTC published a Notice of Proposed Rulemaking on April 4, 2014, requesting comments on new rating, certification and labeling requirements for gasoline blends with more than 10% ethanol and an alternative method to determine the fuel rating of gasoline.

Many comments supported the need for new labeling and testing methods; however, commenters suggested several modifications, including defining gasoline to include E15, an octane label for ethanol blends and an alternative label for ethanol blends of 51% to 83%, among other modifications.

The amendments include modifications in response to the comments, the FTC said.

“After considering the comments received in response as well as Environmental Protection Agency (EPA) decisions related to ethanol blends, the commission now issues final ethanol fuel amendments,” it said. “The final amendments require that entities rate and certify all ethanol fuels to provide useful information to consumers about ethanol concentration and suitability for their cars and engines. Responding to the comments, the final amendments provide greater flexibility for businesses to comply with the ethanol labeling requirements, and do not adopt the alternative octane rating method proposed.”

The National Association of Convenience Stores (NACS) and the Society of Independent Gasoline Marketers of America (SIGMA) advocated for a single label for mid-level blends. They said many retailers cannot know the ethanol content within 10% because they do not blend their own fuels and mix fuel deliveries with preexisting fuel in their storage tanks.

“Even if retailers are in a position to make this determination, requiring them to constantly shift the labels on their blender pumps (E20 one day, E40 another day, etc.) would be exceedingly burdensome and have little offsetting benefit to the consumer,” they said.

The Outdoor Power Equipment Institute (OPEI) issued a statement on the ruling.

According to most engine manufacturers, OPEI said, fuels containing greater than 10% ethanol can damage or destroy outdoor power equipment, including lawn mowers, chain saws, generators, utility vehicles and other small-engine equipment such as motorcycle, snow mobile and boat engines. Fuels containing more than 10% may void product warranties, and by federal law, it is illegal to use higher ethanol fuel blends, specifically E15, in outdoor power equipment.

“We appreciate efforts by the Federal Trade Commission to regulate and manage the rapidly changing fuels marketplace, requiring that gas pumps be labeled with percentage of gasoline and percentage of ethanol added,” said Kris Kiser, president and CEO of OPEI “However, the agency didn’t go far enough. We fear consumers will remain confused and inadvertently misfuel their small engine equipment, in particular.”

Ethanol producer groups argued “May Harm Other Engines” is scientifically unsubstantiated and unduly harmful to the ethanol industry.