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EPA denies ethanol waiver; fuel blends to remain the same

The waiver, sought by 8 states, would have temporarily stopped the production of ethanol for motor fuel.

By Clifford Atiyeh Nov 16, 2012 10:54AM
The Environmental Protection Agency has denied a waiver to temporarily halt the nation's ethanol requirements, a blow to eight states hoping for a reprieve from rising corn prices and the second time in four years the agency has denied such a waiver.

Over the summer, 80 percent of American farmland was caught in the worst drought since the 1950s, reducing crop yields and raising corn prices to record highs. Eight states -- including Georgia, New Mexico and Texas, which was denied a waiver in 2008 -- sought a temporary reprieve from the Renewable Fuels Standard, citing the need to curb demand for corn and lower prices. The law requires corn producers to grow and sell crops for production of ethanol, which is then blended with gasoline at up to 15 percent. Many of the states, which use corn feed stocks for poultry and cattle farms, said the ethanol law was a direct financial hardship and thus grounds for a waiver.

Of course, corn farmers and other ethanol lobbies didn't see it that way. That means you'll still be filling up your car with the maximum amount of ethanol allowed by law.

“We recognize that this year’s drought has created hardship in some sectors of the economy, particularly for livestock producers,” Gina McCarthy, an EPA administrator, said in a statement. “But our extensive analysis makes clear that congressional requirements for a waiver have not been met and that waiving the RFS will have little, if any, impact.”

The EPA said that if ethanol production were suspended, the price of a bushel of corn would drop by just 7 cents, based on an average of 500 scenarios. Their studies were based entirely on price models developed by Iowa State University, a public university in the No. 1 corn producing state in the country. Last year, Iowa's corn yield accounted for nearly one-fifth of the nation's crop.

The EPA has a rather loose set of rules that allow a waiver, notably that "the mandate itself would severely harm the economy" and a "high threshold for the nature and degree of harm." In 2008, Texas submitted a request for an ethanol waiver and was denied.

In December 2011, Congress let a 30-year ethanol subsidy expire, but the EPA still requires increasing levels of ethanol production every year through 2022, when the mandate calls for 36 billion gallons. U.S. ethanol is almost entirely made from corn, although the fuel can be made from sugar -- which Brazil uses to great effect -- and other plants such as switchgrass.

While touted as a renewable, domestic fuel that produces fewer greenhouse gas emissions than gasoline, ethanol has been criticized for driving up food prices, especially in poorer countries that rely more heavily on corn products. The United Nations has repeatedly called for the U.S. to end the Renewable Fuels Standard, and in August, a UN official sided with the eight states calling for the waiver.

The best benefit of ethanol, however, has to be for owners of the Koenigsegg Agera. When filled with an 85-percent ethanol blend, the supercar's V8 engine jumps from 960 to 1,140 horsepower.

[Source: EPA]

3Comments
Nov 17, 2012 7:49AM
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"Of course, corn farmers and other ethanol lobbies didn't see it that way. That means you'll still be filling up your car with the maximum amount of ethanol allowed by law."

Not me - my car runs on ultra low Sulfur diesel fuel, obviating the need for gasoline and bypassing the Ethanol debacle. Running clean diesel cars causes financial damage to the Ethanol lobby, and the ridiculous EPA requirements. Ethanol is not added to the diesel fuel in my state.
Nov 20, 2012 6:18AM
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The whole corn ethanol situation is getting out of hand.  Congress lets the requirement for it lapse and the EPA still requires higher volumes of it.  The automotive industry, small engine manufactures and the oil companies petition the EPA to prevent E15 and the EPA replies their arguments invalid because they “do not have a stake in the issue”.  Even if the math is done at an Iowa or Illinois university, there is still no net energy gain by using corn ethanol, it’s breakeven at best.  If the EPA is going to require ethanol, they need to get behind a truly renewable kind such as cellulose.  Switchgrass can be grown anywhere, doesn’t require irrigation or fertilizer and can be grown on land that isn’t suitable for regular agriculture.  But then again, the corn lobby from Iowa and Illinois will NEVER let that happen.  I know E15 will never be going anywhere near my supercharged engine.    

Nov 21, 2012 8:55AM
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"Don't use in other vehicles, boats, or gasoline-powered equipment. It may cause damage and is prohibited by federal law." Which means I can choose to break the law or not use my gasoline powered equipment! And if you own a vehicle made prior to 2001, your options in some states are to risk damaging your vehicle (and breaking the law?) or to not drive !

An Iowa study was done which results benefit corn producer-states and then corn-lobby... Sorry but that raises all kinds of questions about impartiality!

"When filled with an 85-percent ethanol blend, the supercar's V8 engine ." Yes, because as a primary fuel it burns cleaner without the risk of detonation. When Ethanol is a fuel additive, it is a whole different animal. I can accept the 10%, but I cannot accept not knowing what percentage I am currently using. Current pumps in Memphis indicate these fuels contain ethanol, but no percentage is indicated. Which means the many older vehicles I see are going to get suffer from additional repairs and expense.

 

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