WILL E0 DISAPPEAR?

For the first time in several years, the EPA has published the ethanol blending quotas for next year in accordance with the schedule set in the law, EISA 2007. The EPA Final Renewable Fuel Standards for 2017 can be found here at the EPA website.

Suffice it to say, the upbeat tone of the announcement masks the serious problems with mandating ethanol blending into the nation’s gas supply. There are many ironies in this announcement, but to give you a little insight into the absurdity that abounds, I’ll present just one fact. EISA 2007 mandated that the amount of renewable fuels that must be blended into our fuel supply in 2017 shall be 24.0 billion gallons, yet this announcement specifies that only 19.28 billion gallons shall be blended. If you want more information about this divergence, you might peruse this article in the Ethanol Producer Magazine. Be warned, there is a pile of gobbledygook in the article.

There are a couple of interesting sidelights in the Renewable Fuel Standards. Number one: we are essentially at the blending wall. In order to blend more ethanol into our gasoline, it will have to be E15 or higher. Number two: we have finally reached the corn ethanol ceiling of 15 billion gallons of corn ethanol. Or course, we’re a couple of years late according to the Act. All increases in renewable fuel for auto gasoline must now be made up by “advanced ethanol,” and there isn’t much of that around because it can’t be made by any known commercially viable process. All of this is monumentally ironic since EISA 2007 is not a mandatory E10 law and E10 is nowhere defined as “renewable fuel” in the Act.

The result of this announcement is: the availability of ethanol free unleaded auto gas (E0) may be coming to an end. According to this article in Hemmings Daily, the days of ethanol free auto fuel are numbered. The EPA wanted to do away with it in 2017, but that doesn’t look likely. If you don’t want to take the time to read the article, here is the pertinent quote: “Despite worries that the Environmental Protection Agency would put an end to ethanol-free gasoline sales with its Renewable Fuels Standard ruling for 2017, the agency permitted E0 a reprieve at the same time it declared its intention to transition the entire nation’s fuel supply to E10 and above.“

So we’ve been warned. (Actually, there are some scarier statements by the EPA in that article about what is coming.)

Wonder if the new administration which claims to be more attuned to unleashing free enterprise will recognize the largest federally mandated market manipulation program in history for what it is, corporate socialism, and repeal EISA 2017. One can always hope.

12/8/2016: Whoa there. Maybe more than hope. Team Trump is proposing Scott Pruitt, AG of Oklahoma, waterboy for big oil as head of EPA. Yes, that Scott Pruitt “… who filed a friend of the court brief in a lawsuit against EPA over the RFS, arguing that using corn for ethanol increased food prices, and that the biofuel posed a risk to automobile engines. “The evidence is clear that the current ethanol fuel mandate is unworkable,” Pruitt said.”

WHAT EVER HAPPENED TO SECTION 203

Not only does the EPA not follow the law in managing the ethanol quotas as outlined in Section 202 of EISA 2007 it appears to be completely ignoring SEC. 203. STUDY OF IMPACT OF RENEWABLE FUEL STANDARD and SEC. 204. ENVIRONMENTAL AND RESOURCE CONSERVATION IMPACTS

According to Section 203 the EPA is supposed: ” to assess the impact of the requirements described in section 211(o) of the Clean Air Act on each industry relating to the production of feed grains, livestock, food, forest products, and energy.

According to Section 204 the EPA is supposed to study: “Environmental issues, including air quality, effects on hypoxia, pesticides, sediment, nutrient and pathogen levels in waters, acreage and function of waters, and soil environmental quality.” It’s supposed to also study: “Resource conservation issues, including soil conservation, water availability, and ecosystem health and biodiversity, including impacts on forests, grasslands, and wetlands.”

These studies are supposed to insure that: “… in the case of any such renewable fuel produced from new facilities that commence construction after the date of enactment of this sentence, achieves at least a 20 percent reduction in lifecycle greenhouse gas emissions compared to baseline lifecycle greenhouse gas emissions.”

Well, what do you know? According to this study, things aren’t going so well:

http://www.ewg.org/agmag/2014/12/corn-ethanol-lump-coal-your-christmas-stocking

If anyone believes that corn ethanol is achieving: “… at least a 20 percent reduction in lifecycle greenhouse gas emissions compared to baseline lifecycle greenhouse gas emissions.” is smoking some pretty good shit and I want them to share.

Pretty damn hilarious.

I TOLD YOU SO!

I’ve been waiting for the “I told you so” moment, so I could stop writing about this lunacy.

An article in the Well Servicing Magazine a couple of months ago, probably one among many because I haven’t done much research on this topic lately, sums it up pretty well. (Pun intended) The Renewable Fuel Standard (RFS) in EISA 2007 is imploding. After a search of the Internet I can’t even find where the EPA finalized this years ethanol blending quota, which was supposed to be set by the end of December last year. They don’t even follow their own rules. Here is the EPA proposed 2014 RFS and it is indeed the 2012 quota, but I can’t locate the finalized version.

As any fool could have seen, the constantly increasing quota to blend ethanol in gasoline was unsustainable. And finally this year, the EPA, which has sole authority to set the blending quota, blinked. Instead of increasing the quota as proscribed in the blending table embedded in the act, they decreased mandatory blending levels.

WE HIT THE BLENDING WALL

I doubt there is anywhere to go from here. Without producing copious amounts of E85, which isn’t going to happen, there is no way to fulfill the ethanol blending quota table in the RFS. E15 was dead on arrival when the EPA made it voluntary. The auto producers have wisely refused to warranty their products for anything above E10 in a non flex-fuel vehicle car. Producers and gas station chains will not sell it because they can’t afford the liability. Congress isn’t about to give them a liability waiver. If anything, Congress is trying to repeal the RFS.

On top of everything else, corn ethanol production would be capped next year anyway, so there is no use building more plants. There will be no increase in production, unless they can export it. Cellulosic ethanol was supposed to carry all of the increased ethanol production burden demanded by the quota table, but there are no commercially viable cellulosic ethanol plants, and without a market, which would have been available if E85 took off, there is no incentive to even try to perfect a process, unless it can be produced at a lot less cost than corn ethanol, which appears unlikely after three decades of trying.

I just hope the grownups in the EPA and the Congress will end this charade. Hmmm, “grownups” used in the same sentence as EPA and Congress? Disregard that, because it’s an oxymoron.

EPA DENIES RFS WAIVER

FULL SPEED AHEAD INTO THE BLENDING WALL!

On Friday, November 16, 2012, the EPA denied the waiver petition made by several states to drop mandatory ethanol blending as required by EISA 2007 for one year.  You can find the denial as quoted here, “Based on the entire record before it, EPA has determined that each of the petitions and requests should be denied.” in the EPA document.

This is what the waiver denial portends.  Even with the carry forward RINS, which are delaying the blending wall by maybe 20 billion gallons of E10 / year, by 2014, at the latest, the ethanol quota, cast in stone table, in EISA 2007 will swamp the gasoline pool and there will be nowhere to put the ever increasing ethanol quotas after that and the ludicrous E15 waiver will not delay this fact.

It was clear that the quota table in EISA 2007 was designed to produce Renewable Fuel, which is only defined as E85 in the act. OK, in one place in the act it is defined as E11 – E85, but it is NEVER defined as E10.  However, we produce a minuscule amount of E85 and that will not increase enough in the next few years to avoid the blending wall because of the massive infrastructure that would be demanded to distribute and sell it.  The fact that all of the gasoline in the U.S. is becoming E10 is an unintended consequence of EISA 2007 since E10 is NOT Renewable Fuel as defined by the act.

So here is a suggestion for the states that were denied the waiver.  Any state can prohibit the blending of ethanol in all of the gasoline in their state, except for those few mandatory oxygenate areas that are still left, which are a few big urban areas and most of Southern California.  There is no mandatory federal E10 law.  EISA 2007 certainly isn’t a mandatory E10 law, it is a Renewable Fuel law, and E10 is NOT Renewable Fuel as defined in the act.  So if a state can pass a mandatory E10 law, like my home state of Oregon did, useless as it is now, any state can clearly pass a law prohibiting E10 being sold in the state.  This would certainly accelerate hitting the blending wall thus exposing what a farce and sham the federal Renewable Fuel Standard really is.

Of course until such time as the congress critters repeal the federal RFS in EISA 2007, which they might do if they finally wake up and understand that it can’t possibly fulfill its intended purpose, the gasoline producers will have to deal with ever increasing quotas of ethanol with nowhere to blend it.  If the EPA is as obstinate as it is now with the cellulosic ethanol quotas that the gasoline producers must pay waiver penalties for a product they can’t buy, then the gasoline producers will have to do something with the ethanol they can’t blend.  I have a suggestion.  Start constructing large tank farms in Illinois, as near to ADM headquarters as possible, and the Iowa home of Senator Chuck Grassley, the champion of the RFS and the water boy for ADM.  Just store the billions of gallons of ethanol in their back yards, by 2022 you are going to have to be able to store about 15 billion gallons of the stuff every year that you can’t use.  You can just pass along the costs to us consumers just as you do with the millions of dollars in penalties for the cellulosic ethanol waiver credits.  I’m sure we won’t mind, because we certainly don’t mind that you must pay for a product you can’t even buy, and you are passing along the costs to us right now.

Oh, and by the way, the whole EPA waiver review was a complete farce.  Look on page 79 of the Notice, “The commenter failed to acknowledge that EPA is not required to issue a waiver when severe economic harm to a state, region or the United States is demonstrated. The statute provides that EPA “may” do so in that situation.”  Bazinga!  There was never the remotest chance in Hell that the EPA was going to grant the waiver.  I hope the states wake up and take matters into their own hands.  They have every opportunity to as outlined above, just ban E10 in your state.

Is EPA Administrator Jackson Waiting For Someone To Die?

I sent the following email to EPA Administrator Lisa Jackson:

Dear Administrator Jackson:

The following post was left on the pure-gas.org web site in the Comments section:

“Recently our fire dept. was responding to a brush fire where the fire was about the get into a barn.  Our brush truck has a gasoline powered engine (which is almost new) in which we had a difficult time cranking to extinguish the fire.  Upon our investigation after the fire we found the cause of failure of the pump operating was due to ethanol gas.  The repair agency advised that we should not use ethanol gas on small engines due to this problem and that we should not store ethanol gas no more than 2 weeks.  Unfortunately we must store some gas for emergencies on fire apparatus for calls.  At some times it can be stored for quite some time before we use it.  How are fire dept’s suppose to operate equipment properly and store gas for emergencies with this causing engine problems?  Hope you don’t need to depend on this to save your life, the engine may not start???????  -Tony Collins, Advance, NC  (February 9, 2011)”

You can see it for yourself here:  http://pure-gas.org/comments, use the View all comments button to get to this earlier comment.

Are you going to wait until someone dies when portable equipment won’t start or quits during an emergency because of the unintended consequences of the RFS mandate in EISA 2007 that are turning all of the gasoline in the U.S. to E10?  As it stands now first responders and emergency crews cannot get ethanol free gasoline in California and most of the Northeast.  It is rapidly disappearing in the Northwest too, and it is apparently a serious problem in North Carolina.  I urge you to prohibit the blending of ethanol in all premium unleaded gasoline sold in the U.S., as you were requested by numerous organizations in the E15 comments, before someone is killed.

Regards — Dean Billing / Sisters, OR
www.e0pc.com
www.flyunleaded.com

I would urge others in the Public Safety field to let Administrator Jackson know if you have concerns about how the ethanol mandate is affecting your portable tools and equipment … before it is too late.  You can email her at jackson.lisap@epa.gov

Update 03/30/2011: Apparently the EPA is waiting for someone to die, as the following reply illustrates:

Dear Mr. Billing:

Thank you for your February 15, 2011 email to Administrator Jackson concerning the use of ethanol in gasoline and problems with small, non-road engines in emergency equipment. …

We are aware that some small, non-road engines are having problems with gasoline that contains 10 percent ethanol (E10). Furthermore, we have found that gasoline with 15 percent ethanol (E15) is not suitable for such engines.  As we transition to E10 and E15 we are monitoring the situation.  Please contact us if we can be of further assistance.

Sincerely,

Karl J. Simon, Director
Compliance and Innovative Strategies Division, Office of Transportation and Air Quality

So there you have it in black and white, “… we are monitoring the situation.“

Translation from bureaucratese, “Yes, we are waiting for someone to die and if there is a public outcry, we will react.”

All Of A Sudden The EPA Administrator Is Worried About “Unintended Consequences”

Say what? The EPA Administrator is worried about the unintended consequences in a new greenhouse gas bill.

“EPA Administrator Lisa Jackson said during her testimony before the subcommittee Wednesday that there could be unintended consequences from the legislation.”

Who is the Administrator kidding?  The federal RFS mandate in EISA 2007 has caused humongous unintended consequences, including massive economic dislocation and property damage in the marine, aviation, antique and classic car, motorcycle, and small engine industry which will undoubtedly lead to death in the public safety sector that relies on portable tools.

The federal RFS mandate was supposed to spur the production and distribution of E85 and manufacturing of flex-fuel vehicles which are the only kind of vehicles that can use E85.  E85 is the ONLY Renewable Fuel mentioned in the act.  E10 is NEVER mentioned in the act.  E10 IS NOT Renewable Fuel as recognized by ASTM, it is gasoline laced with ethanol.  There is only one place in the act that other than E85 is mentioned, Section 244 (a), “DEFINITION OF RENEWABLE FUEL BLEND.—For purposes of this section, the term ‘‘renewable fuel blend’’ means a gasoline blend that contains not less than 11 percent, and not more than 85 percent, renewable fuel …”.  The objective of of that section of the act, and other similar sections, is clearly to shower corporate welfare on E85.

EISA 2007 IS NOT A MANDATORY E10 LAW, yet by the end of this year or early next year all of the gasoline sold in the country will be E10 because of the draconian ethanol production quotas cast in stone in the act.  Talk about unintended consequences.

The only way to avoid further unintended consequences of the federal RFS mandate is to prohibit the blending of ethanol in all premium unleaded gasoline in the U.S. or outright repeal of the RFS section of EISA 2007.  So what about it Ms. Jackson?  Are you really interested in avoiding truly huge unintended consequences?

THE E15 WAIVER THAT MEANS NOTHING

So the EPA has spoken and the E15 waiver is D.O.A. According to the E15 waiver comments of the National Petrochemical & Refiners Association the EPA does not have the legal authority to grant a partial waiver, it can only grant a waiver for all cars or deny the waiver. The NPRA stated in their waiver comments, “EPA raises in the Waiver Notice the possibility of conditionally approving the use of E15 or lesser mid-level blends only for a limited subset of vehicles. 74 Fed. Reg. 18,230. If EPA were to develop such a “bifurcated fuels” program pursuant to a partial E15 waiver, the Agency would be at risk for a CAA section 307 judicial challenge alleging that the Agency’s interpretation of section 211(f)(4) is unreasonable and exceeds the Agency’s authority.”

Since the EPA E15 waiver is permissive, that is it isn’t a mandatory E15 law, nobody has to make E15 and the gasoline producers were pretty much unanimous in their E15 waiver comments that they weren’t going to make a product with such high liability for damage without the government passing liability legislation holding them and their dealers harmless. In addition there are no new cars built from 2007 until today that have warranty coverage for E15, so who is going to pump a product into their gas tank that will void their warranty, cut their mileage and costs more than E10 does, because today ethanol is more expensive than gasoline … again!

It isn’t going to prevent, or even delay, the blending wall.  The funniest thing is that it can’t be sold in most states without state law changes, including California. So why all the fuss?

Footnote:  Even the Renewable Fuels Association agrees that E15 cannot be put in non flex-fuel vehicles any time soon, ““Until health effects testing is completed, fuel producers have a 211(b) certification from EPA, certain state fuel regulations amended, and EPA’s misfueling and labeling proposed regulation finalized, E-15 must be confined to and labeled specifically for flexible fuel vehicles only,” explained the two groups in a joint release.”

E15 Will Make No Difference Now, Part II

Wonder when the EPA and the ethanol lobby are going to wake up?  If anyone ever bothered to read the RFS mandate in Section 202 of EISA 2007, which is driving all of this ethanol blending madness, they would find out that E10 or E15 is never mentioned in the act and that EISA 2007 is NOT A MANDATORY E10 law.  The RFS only deals with bio-diesel, E85 and flex-fuel vehicles.

So why all the  folderol over getting a waiver from the EPA for E15?  Because there is a huge problem buried in Section 202 (A) 2:  APPLICABLE VOLUMES OF RENEWABLE FUEL.  It is a hard coded table.  It outlines the volume of ethanol that must be produced and blended into gasoline by year:

Applicable volume of renewable fuel

Calendar year:                                   billions of gallons
2006 …………………………………………………………………… 4.0
2007 …………………………………………………………………… 4.7
2008 …………………………………………………………………… 9.0
2009 …………………………………………………………………… 11.1
2010 …………………………………………………………………… 12.95
2011 …………………………………………………………………… 13.95
2012 …………………………………………………………………… 15.2
2013 …………………………………………………………………… 16.55
2014 …………………………………………………………………… 18.15
2015 …………………………………………………………………… 20.5
2016 …………………………………………………………………… 22.25
2017 …………………………………………………………………… 24.0
2018 …………………………………………………………………… 26.0
2019 …………………………………………………………………… 28.0
2020 …………………………………………………………………… 30.0
2021 …………………………………………………………………… 33.0
2022 …………………………………………………………………… 36.0

Now keep in mind that the U.S. uses about 135-140 billion gallons of gasoline / year.  It has been in that range since the economic collapse started in 2008 and won’t likely rise in the foreseeable future unless the economy improves markedly.  If every drop of gasoline was E10, it would take, at most, 14 billion gallons of ethanol and the apparent advantage is that the refineries would only have to produce 126 billion gallons of gasoline so it appears we would use less oil, although nobody knows if that is actually true, since no one has done a large, statistically significant study of mileage before and after E10 is widely implemented.

Look at the table.  During 2012 the U.S. ethanol industry must produce more ethanol than can be put into all of the auto gasoline.  Clearly, after 2012 we are going to have ethanol coming out of our ears.  Are you beginning to understand why the RFS portion of EISA was clearly written for E85 and why the unintended consequences of the act are getting ugly?

So 2012 is the “Blending Wall” and in order for the ethanol industry to “delay” the blending wall while they try to get more taxpayer money out of Congress and state governments (which are going bankrupt, so not too likely) to add E85 infrastructure and get laws passed to force the auto industry to build more dinosaur “flex-fuel” vehicles, they figure the easiest way to delay the blending wall is to get the EPA to force gasoline companies to make E15 and force you to use it in your non flex-fuel vehicle.  And how long might that delay the blending wall?  Well, we would need 21 billion gallons of ethanol to take all of the gasoline E15, so the delay would be out to about 2016, maybe a four year delay, max.  But then we would still be at a blending wall.  Unless the U.S. starts making “Renewable Fuel”, which is E85, we are going to face a blending wall.

But it turns out there are a lot of niggling little details that need attention in order to actually implement the E15 waiver, if it is even granted.  The simple problems involve the EPA’s own set of rules about how they can go about raising the ethanol blending limit for non flex-fuel vehicles and they mainly involve a whole lot of testing.  That testing is beginning to indicate that E15 might be allowable in a range of cars, say 2007 and newer, perhaps 2001 and newer, but the testing won’t be finished for at least another couple of months, maybe more.  So the earliest that the EPA could grant some kind of waiver is looking like the end of 2010, leaving only two years until hitting the wall.

Now comes the real Gordian knot.  According to the API (American Petroleum Institute), the “evil foe” of the ethanol lobby, there are a few more hoops to jump through before you can actually foist E15 on an unsuspecting public.  They are outlined in this report.  The gist of the report is that it is going to take time, in some cases a long time, to implement E15, to say nothing of whether service stations are going to want to handle a new product with unknown liability, other than it will increase property damage.

I think the most ironic problem is that ethanol blending caps are built into a lot of state laws, as outlined in Appendix A of the report.  I live in Oregon, a mandatory E10 state.  The mandatory E10 law, passed in 2007 before the federal law passed, has infuriated a lot of our citizens.  But we are lucky in a way because embedded in that law is a 10% ethanol cap, so it is going to take a legislative change to remove the 10% limit, and this time we are prepared to fight, especially when you consider that the federal RFS mandate is supposed to be for “Renewable Fuel” which is E85.

In the final analysis though, we will be at the blending wall before E15 ever reaches the market, as I have predicted in past blogs.  It will be interesting to see the reaction of citizens when they can’t find ethanol free fuel anymore and the property damage increases and the economic impact to the aviation, marine and public safety industry spreads through an already fragile economy.

It Isn’t The Blending Wall We Should Be Worried About

New Math At The EPA

If you look at consumption statistics from the EIA you would find that the US consumed about 42 billion gallons of diesel and 136 billion gallons of auto gas in 2009.  Those stats show a decline in diesel usage and a tiny increase in auto gas usage over 2008, a year when both stats declined over 2007.  In 2009 the EPA mandated that 10.2% of that total consumption of 178 billion gallons of liquid hydrocarbon fuel be from renewable resources.  That would result in about 18 billion gallons of renewable fuel of which at least 10.5 billion gallons had to be fuel ethanol as outlined in the table in EISA 2007 (Section 202, page 31).  What is strange is that .6 billion gallons had to be “Advanced Biofuel” resulting in the total RFS requirement of 11.1 billion gallons.  So what was the other 6.1 billion gallons required by the EPA?

The EPA has just announced the 2010 standard.  The EIA 2010 projection is:  “Consumption of motor gasoline rises by 50,000 bbl/d, or 0.6 percent, and distillate fuel consumption increases by 80,000 bbl/d, or 2.1 percent.”  This would result in a diesel usage of  almost 43 billion gallons and an auto gasoline usage of  almost 137 billion gallons for a total of 180 billion gallons of liquid hydrocarbon fuel.  The EPA has set the renewable fuel mandate to be 8.25% or almost 15 billion gallons of renewable fuel.  Quite a drop don’t you think?  Of the total 12 billion gallons has to be fuel ethanol and .95 billion gallons has to be “Advanced Biofuel” for a total RFS mandate required by EISA 2007 of 12.95 billion gallons.  So what is the other 2.05 billion gallons of renewable fuel required by the EPA?  Anybody know?

Now here is the real problem, discounting the math which doesn’t obtain.  This year there was supposed to be 100 million gallons of cellulosic ethanol in that .95 billion gallons of “Advanced Biofuel” number according to the hard coded table in EISA 2007.  The EPA has lowered the quantity to 6.5 million gallons required.  Anybody noticing the huge difference! The change was made after 30 companies said they could not produce the required 100 million gallons.  Thirty companies couldn’t come up with 100 million gallons of cellulosic ethanol?

Do you know how many years the government has been throwing your tax dollars at cellulosic ethanol?  According to The Cellulosic Ethanol Site “Modeling and experimental studies on dilute hydrolysis systems were carried out during the first half of the 1980s. DOE and USDA sponsored much of this work.”  The industry has said that a viable commercial cellulosic ethanol process is five years away for the last three decades and today they still say that “we are only five years away from a viable cellulosic ethanol process”.  And according to the above site your tax dollars are still being showered on them:  “In March 2007, the US government awarded $385 million in grants aimed at jumpstarting ethanol production from nontraditional sources like wood chips, switchgrass and citrus peels. Half of the six projects chosen will use thermochemical methods and half will use cellulosic ethanol methods.”  Apparently none of those 2007 grants produced much of anything since 30 companies can’t even make 100 million gallons of ethanol this year.

But the real crux of the problem is that after 2015 all of the increase in the ethanol mandate in EISA 2007 must be met by “Advanced Biofuels”, corn ethanol will be capped at 15 billion gallons.  In 2015, 6.5 billion gallons of “Advanced Biofuel” must be produced of which at least 3 billion gallons must be cellulosic biofuel (ethanol).  Never mind that the ethanol blending wall will be met no later than 2012, the true idiocy of the RFS mandate in EISA 2007 will be totally exposed when there is no way to get from 2015 to 2022.  Of course none of it will be needed unless the ethanol industry, Congress and the auto industry figure out how to move to E85 which was the whole point of EISA 2007 in the first place.  Read the act, it is a corporate welfare act for E85.  E10 is never even mentioned and there is no corporate welfare for E10, E15, ad nausea other than the blenders credit which actually pays for infrastructure upgrades for the oil distribution industry.

EISA 2007 Is A Hazard To Public Safety

Who will be the first human casualty of the unintended consequences of EISA 2007

Today is the last day to comment on the E15 waiver request that is before the EPA.  I have learned a few things from those comments, none of them bode well.

I wonder if anyone at the EPA actually understands the federal RFS mandate.  You would think they should because they are the federal department tasked with implementing the mandate.  Anyone with an ounce of sense would look at the ethanol production quota table in Section 202 and instantly recognize that the Act was designed to produce and distribute E85.  The production demands are so large that by 2011 – 2012 there will be enough ethanol produced to take every gallon of gasoline in the U.S. E10 and all of the tax incentives and corporate welfare built into the Act are for E85, E10 is never mentioned.

So what happens when all of the gasoline in the U.S. is E10.  Something very interesting.  The Director of the Division of Air Resources, New York State Department of Environmental Conservation commented:  “E10 is not simply ethanol added to finished gasoline. Since most gasoline at retail contains ethanol, the industry factors the addition of ethanol into the formulation of the petroleum-based portion of the final blend. The chemical properties of ethanol and its dilution impact allow refiners to produce a petroleum-based blendstock which when combined with a specified amount of ethanol (or other oxygenate) results in a final blend with the desired legal and market properties.  The petroleum based blendstock, in most cases, would not qualify as gasoline or be legal to sell as gasoline.  For RFG this blendstock is RBOB. For conventional gasoline it is CBOB, and for California RFG it is CaRBOB.”

Does anyone at the EPA understand that there won’t be any ethanol free finished gasoline available for those engine applications that cannot run on ethanol belended gasoline?  Do they understand what will happen to the marine industry, aviation industry and public safety organizations that rely on small engines for their pumps, generators and portable tools?  Is the EPA prepared for the liability and litigation that will ensue from their decision to allow all of the gasoline in the country to go E10 or higher?  Liability will rest directly with the department since it is tasked with implementing the deeply flawed RFS mandate.

My final comment to the EPA for the E15 waiver can be read here.