WILL EPA'S PLANNED BIFURCATION OF E15 RULE DO MORE HARM THAN GOOD?

Sep, 27, 2010  |  Today's News

The U.S. Environmental Protection Agency has been delaying its decision to grant a waiver request to raise the ethanol blend in our nation’s fuel supply for many months now. A bit longer delay to accommodate a singular announcement of a higher blend approval seems the wise course of action now, rather than “bifurcating” or separating the decision into stages based on model years. The model year based bifurcation may cause unnecessary consumer worry and retail angst.

Illinois Corn Growers Association President Tim Lenz, a corn farmer from Strasburg, said, “EPA’s indication that they will bifurcate, or separate, their rule on higher ethanol blends based on model years is completely unnecessary,” Lenz added. “Continued insistence on that plan is starting to look like stubbornness or something worse…”

In the AP story below, Matt Hartwig of the Renewable Fuels Association adds to that point, "EPA's insistence on bifurcating the market this way, and possibly again with 2001 and newer (cars), without providing any scientific evidence creates unnecessary confusion that may hinder additional ethanol sales, not expand them.”

By Russell Blinch

WASHINGTON, Sept 23 (Reuters) - U.S. Energy Secretary Steven Chu said on Thursday his department was on schedule to deliver testing data on a higher blend of ethanol for motor vehicle gasoline.

 "We're going to have all the information ready for the EPA by the end of the month," Chu told reporters at a conference.

The Department of Energy is studying whether fuel containing 15 percent ethanol, known as E15, can be burned safely in traditional car engines. The current blend level is 10 percent.

Chu's agency previously had delayed completion of the tests but is now expected to deliver data on the first set to the Environmental Protection Agency by the end of September. The first set centers on the effect of E15 on cars built in

2007 and later.

The DOE is expected to deliver data on cars built from 2001 to 2006 by the end of November.

If the EPA approves the blends, it could provide a boost for the domestic ethanol industry, which has suffered in recent years from tight financing and high costs for corn and other inputs.

Companies that could benefit include Archer Daniels Midland (ADM.N: Quote), Poet, a privately held company, and oil refiner Valero Energy Corp (VLO.N: Quote).

The auto industry has urged the government to conduct full tests for E15 because it is worried the blend could corrode fuel lines and damage engines.

EPA Administrator Lisa Jackson told a congressional hearing on Thursday her agency would make a decision soon after receiving the data. "We are prepared to render our decisions within two weeks," after getting the data, she said.

Growth Energy, a group of ethanol producers who filed for a government waiver that would allow the higher blends, has said E15 could be available in March or April if the EPA approves the fuel for both sets of cars by the end of the year.

But many producers also say E15 can be used safely in nearly all older engines and fear the government's bit-by-bit process could bring confusion to the market.

"EPA's insistence on bifurcating the market this way, and possibly again with 2001 and newer (cars), without providing any scientific evidence creates unnecessary confusion that may hinder additional ethanol sales, not expand them," said Matt

Hartwig, a spokesman for the Renewable Fuels Association trade group.

(Additional reporting by Timothy Gardner and Charles Abbott; Editing by Walter Bagley)