US EPA Seeks Approval for Expanded Ethanol Sales in Midwest
EPA Seeks White House Approval for Rule Expanding Ethanol Sales
The U.S. Environmental Protection Agency has requested the White House to approve a rule allowing expanded sales of higher-ethanol gasoline in certain Midwestern states. This request comes after governors from these states made the appeal.
Concerns Raised by Oil Industry
The request has faced opposition from the oil industry, which has warned the Biden administration that allowing E15, or gasoline with 15% ethanol, in select states could lead to supply chain issues and higher gasoline prices. These concerns have stalled the request.
Inflation and Economic Impact
Inflation and the health of the economy are key vulnerabilities for President Joe Biden’s 2024 re-election bid. The potential impact of expanded ethanol sales on these factors is being closely scrutinized.
Proposal Details
In March, the EPA proposed that E15 could be sold year-round in Illinois, Iowa, Minnesota, Missouri, Nebraska, Ohio, South Dakota, and Wisconsin, following petitions from these states. The proposal includes an effective date of April 28, 2024, for all states and was sent to the White House for final review on Monday.
Benefits and Restrictions of Ethanol
Ethanol, a domestically produced alternative fuel primarily made from corn, is cheaper by volume than gasoline. However, sales of E15 gasoline are restricted in summer months due to environmental concerns over smog, which limits its year-round availability.
Industry Perspectives
While the ethanol industry advocates for expanded E15 sales nationwide, citing overstated environmental impacts, oil refiners such as HF Sinclair Corp and Phillips 66 have expressed concerns about the logistical complexities and potential fuel supply disruptions associated with a regional approach to E15 sales.
Advocacy for Legislative Fix
Ethanol groups prefer a nationwide legislative fix to allow for expanded E15 sales, as opposed to the regional approach. This would provide a more uniform and predictable framework for the industry.
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