US President Donald Trump called for raising the ethanol blend limit in gasoline sold in the US to 15% year-round.
Emphasizing that discussions are at an early stage during an Apr. 12 White House meeting on global agricultural trade issues with Republican US senators and governors from farm states, the president said, “We’re working on the ethanol [question], and it’s really working out…. We’re going to raise [the limit] up to 15%, which makes a lot of people happy….
“We’re going to go to 12 months, which makes a lot of farmers very happy—because we go from 8 months to 12 months, that’s a big difference. That was always unnecessary and ridiculous,” he said.
Trump also said his administration would work with refiners during a transition period, “which is not easy, very complicated, because we have to take care of our refineries.”
He suggested that refineries would do much better, “because right now there are a lot of them that are not doing well, so we have to help the refineries. So we’re very close to getting that done and we’ve worked hard on that,” Trump said.
“We have to take care of a lot of other people. But we’re working on [a] transition now because there will be a 2-year period of time that we have a little bit of complexity while things are happening, while things are being built,” he said.
Opposes an E15 waiver
An American Petroleum Institute official immediately expressed concern about the idea. “Forcing higher ethanol fuel blends into the marketplace could have negative consequences for US consumers,” API Downstream and Industry Operations Group Director Frank J. Macchiarola said.
“EPA has previously stated that it does not have the legal authority to grant the E15 waiver, and we agree with that assessment. The industry plans to consider all options to prevent such a waiver,” Macchiarola said, noting also that the federal Renewable Fuel Standard is broken, and API would continue to urge Congress to address the problem with legislation.
Leaders of other trade associations outside oil and gas also responded. “President Trump’s promise to expand E15 sales into the summer months will needlessly put 141 million American boaters in danger,” said National Marine Manufacturers Association Pres. Thom Dammrich.
“This shift in policy is simply a political decision meant to appease American farmers who, like American marine manufactures, will be severely harmed by the administration’s recent trade actions,” Dammrich said. “Rather than negotiating smart policy that benefits all stakeholders, the administration is trying to fix bad policy with more bad policy.”
Renewable Fuels Association Pres. Bob Dineen was pleased. “If true, the report suggests President Trump intends to fulfill his commitment to a 15 billion gal RFS. But for that commitment to be fully realized, [US Environmental Protection Agency] Administrator [E. Scott] Pruitt must cease his campaign to destruct biofuel demand with unjustified waivers and other policies meant to undermine the RFS,” he said.
Senators who attended the meeting responded to Trump’s ethanol and gasoline statements following the meeting. “I’m encouraged by the president’s desire to move forward with the sale of year-round E-15 with a [Reid Vapor Pressure] waiver,” Deb Fischer (R-Neb.) said.
Joni Ernst (R-Iowa) also expressed approval. “My colleagues and I previously offered legislation to break down the barriers that have impeded retailers and consumers from accessing E15 during the summer months, ultimately lowering the cost at the pump for folks across the country,” she said.
Andeavor waivers questioned
Charles E. Grassley (R-Iowa) also welcomed Trump’s announcement but added in a joint statement with Roy Blunt (R-Mo.), John Thune (R-SD), Ernst, and Fischer that EPA should stop issuing hardship waivers from renewable fuel quotas to smaller capacity refineries owned by large companies.
EPA recently issued such waivers to three such plants owned by San Antonio-based Andeavor in North Dakota and Utah, which operates larger refineries in Los Angeles and Martinez, Calif.; Anacortes, Wash.; St. Paul Park, Minn., and El Paso, Tex. (OGJ Online, Apr. 4, 2018).
“It’s not only unfair to refiners who follow the law of the land, but to all the farmers and biofuels workers across the country who are counting on President Trump to keep his word,” the senators asserted. “These waivers aren’t getting too much attention nationally, but the farmers we talk to in our home states are upset with EPA about this issue.”
Senate Environment and Public Works Committee Chairman John A. Barrasso (R-Wyo.) disagreed. “The law requires EPA to grant relief to small refineries suffering disproportionate economic hardship from the Renewable Fuel Standard,” he said.
“EPA, working with the [US Department of Energy], must conduct a detailed, objective analysis based on confidential business information. They must look at each small refinery on an individual basis whether or not it is part of a larger company,” Barrasso said. “During the Obama administration, EPA didn’t follow the law and the courts rebuked the agency.”
Barrasso said he applauded EPA’s Pruitt and [US Sec. of Energy] Rick Perry for recognizing the renewable fuel quota program’s burdens. “They know that we can’t allow it to hurt our nation’s small refineries,” he said.
Contact Nick Snow at [email protected].
