Trump Aims to End Ethanol Warnings in Biofuel Policy Blitz

Source: By Jennifer A Dlouhy and Kim Chipman, Bloomberg • Posted: Monday, January 18, 2021

The Trump administration advanced a flurry of biofuel policy proposals Friday, including plans that could help ethanol producers sell more of the corn-based fuel.

Final decisions about those possible changes to biofuel-blending mandates and warning labels at pumps dispensing higher-ethanol E15 gasoline will now fall to President-elect Joe Biden. The Environmental Protection Agency’s proposals ensure the Biden administration will inherit battles over 16-year-old requirements to blend renewable fuels into gasoline and diesel that bedeviled President Donald Trump.

The Trump administration also is set to hand off decisions on dozens of small-refinery requests to be exempted from 2019 and 2020 renewable fuel requirements, given upcoming Supreme Court scrutiny of those waivers. The prospect of last-minute exemptions had galvanized biofuel interests in recent days, prompting a lobbying frenzy with direct appeals to Trump and EPA Administrator Andrew Wheeler.

Under one of the EPA proposals advanced Friday, the agency is seeking to modify or even completely scrap requirements for a warning sticker wherever pumps dispense the E15 gasoline blend containing 15% ethanol. The current orange-and-black sticker cautions that E15 should only be used in passenger vehicles no older than 2001, and should not be used to fuel up boats or other gasoline-powered equipment because of the risk of damage and violating federal law.

Ethanol advocates say it discourages motorists from filling up with E15 and is no longer needed. Ethanol producer POET LLC has encouraged label changes as one of several moves the Biden administration can take right away to make it easier to sell E15.

Warning Label

However, oil and refining leaders have insisted the warning is necessary to ensure the fuel isn’t pumped into equipment not certified to use it. Some lawmakers have advanced legislation that would go in the other direction, roughly tripling the label’s size and explicitly adding the word “warning” to it.

The American Fuel and Petrochemical Manufacturers association joined other groups representing power equipment makers, marine manufacturers, oil companies and motorcyclists in calling the move “reckless” and vowing to fight it.

“EPA’s top priority should be making sure consumers have the clearest information at the pump,” the groups said in an emailed statement. “This proposal doesn’t just fall short, it would make it harder for consumers to distinguish the difference between E15 and E10 fuel.”

The EPA also is proposing changes that could make it easier to store higher-ethanol blends in existing underground storage tanks. Emily Skor, chief executive of Growth Energy, called the proposal a “first step toward removing onerous labeling and underground tank requirements and expanding access to E15 for American drivers.”

Monte Shaw, head of the Iowa Renewable Fuels Association, said the tanks proposal didn’t go far enough to eliminate an “unnecessary barrier to market access for E15” and that the group would now focus on seeking changes with the Biden administration.

“Biofuels producers are ready to work alongside the new leadership to build a cleaner, brighter future as there is much work left to be done to expand market access to higher blends of biofuels,” Shaw said by email.

Renewable identification numbers tracking refiners’ compliance with 2020 ethanol targets rose 12% to 85 cents. The credits are up from about 50 cents three months ago and have been steadily climbing since Biden’s win, stoked by the president-elect’s commitments to address climate change and his criticism of refinery waivers issued under Trump.

Separately, the EPA is seeking comment on requests by governors and some small refineries to pare Renewable Fuel Standard quotas amid the pandemic that has crushed fuel demand.

The agency is also proposing to delay deadlines for fulfilling biofuel-blending quotas, with small refineries having until Nov. 30, 2021 to satisfy mandates from 2019. The deadline for complying with 2020 quotas would shift to Jan. 31, 2022, under the EPA proposal.

— With assistance by Michael Hirtzer