Summer Driving Season

FROM THE JULY ISSUE: Growth Energy CEO Emily Skor discusses the limits of E15 during summer months and the steps being taken to offer the fuel year round.
By Emily Skor | June 25, 2018

“Summer driving” for me will always be the four-hour family drive from St. Paul, Minnesota, to the cabin on Lake Superior. I’ve done that drive every summer of my life. And now my kids can make the same claim. We of course have our “must stop” destinations—the Hayward, Wisconsin, candy shop, Wisconsin fireworks stands, and roadside sweet corn. I would add a number of retailers along the route offering E15 to our list of “must stops” (there is a great Kwik Trip just blocks from the candy shop). But, these retailers cannot sell us E15 this summer. Outdated government regulations prohibit E15 summer sales in Wisconsin and much of the rest of the country. At Growth Energy, we’re working to change that.

E15 is offered by industry-leading retailers at more than 1,300 locations across 29 states. With this shaping up to be the most expensive summer driving season for American consumers in years and considering that E15 typically costs up to 10 cents per gallon less than standard gasoline, you would think consumer demand for the fuel would spike during the summer. But in fact, E15 demand drops between June 1 and September 15 because drivers are robbed of the option at a time when they could most benefit from it.

Decades ago, the Environmental Protection Agency set limits on Reid vapor pressure (RVP), a measure of how easily fuel will turn to vapor, but those rules were never properly updated when higher biofuel blends hit the market. Such a minor oversight should theoretically be easy to rectify. Wouldn’t EPA want fuel regulations to be current with the marketplace? After all, the Trump administration prides itself on cutting needless regulations. But alas, every summer, eco-friendly E15 is held to tougher standards than other fuels sold year-round, cutting off sales and imposing needless costs on retailers.

To comply with the summer restrictions, retailers have to relabel every E15 dispenser twice a year. For 2018, there will be about 40,000 stickers replaced in more than 25 states at a cost of $4 million including labor. It’s a major obstruction for those going the extra mile to expand into new markets and grow our industry. The RVP issue is about more than just a three-month dip in sales. Retailers in many markets simply can’t or won’t retool their labels and fuel offerings each summer, which means E15 is off the menu all year.

It’s clear that E15 is a competitive addition to any retailer’s fuel portfolio, but we need RVP relief to unleash that immense market potential. With RVP, we anticipate 1 billion new gallons of demand in the next five years. Inaction on this issue doesn’t just threaten our industry—it stifles demand that would help lift our rural economy out of the worst crisis in a generation, with farm income plunging to a 12-year low. 

There are forces at play at the EPA, where petroleum lobbysists hold considerable influence, working to keep an RVP fix in bureaucratic limbo. Thankfully, our industry is making progress and mobilizing allies across the heartland to win the fight. We’ve recruited the most powerful supporter anyone could ask for—President Trump. From conversations earlier this year, it was clear that the president was not very familiar with E15. By April, he told reporters and lawmakers that he saw RVP restrictions as “unnecessary and ridiculous.”

Our efforts have moved us closer than ever before to an RVP fix, but it is not yet time for a victory lap. To put “summer RVP season” far in the rearview mirror, we must help our rural champions in Congress and at the United States Department of Agriculture hold the EPA to Trump’s agenda. Any implementation of RVP relief will not come easily. There would be a rulemaking process, a public comment period, a review period, and potential litigation. Growth Energy remains committed to seeing this effort through, and we are closely coordinating with industry stakeholders, retail partners, and our congressional champions to keep the momentum going. Together, we are pushing for this fix that will sustainably and smartly grow the domestic market for American-made biofuels. 

Author: Emily Skor
CEO, Growth Energy