The Push for E15

Growth Energy and other ethanol industry groups made the decision in March to officially file a fuel waiver request for E15 with the U.S. EPA, setting in motion the much-anticipated process to attempt to move the ethanol blend wall. The process is lengthy, but early hints of support from influential parties provide optimism for the industry.
By Erin Voegele | May 04, 2009
In an effort to address the E10 blend wall, Growth Energy and 52 ethanol manufacturers and other supportive parties submitted a fuel waiver request to the U.S. EPA on March 6.

The waiver request was filed in accordance with section 211(f)(4) of the Clean Air Act and seeks to increase the base fuel blend from 10 percent to 15 percent ethanol.

On February 19, Underwriters Laboratories announced it would support the use of up to 15 percent ethanol in certain legacy fuel pumps currently in use. One day later, Susan M. Cischke, Ford Motor Co.'s group vice president of sustainability, environment and safety engineering, wrote a letter to Poet LLC's Chief Executive Officer Jeff Broin, voicing Ford's endorsement of efforts to increase base level fuel blend up to E15.

The timing of these events has led some to speculate that the announcements made by UL and Ford prompted Growth Energy to submit the fuel waiver request. However Growth Energy Chief Executive Officer Tom Buis says this isn't so. While the announcements from UL and Ford do help, Buis says the timing of the waiver request was not dependent on them. "The timing was based more on the fact that ethanol producers have run up against that arbitrary regulatory cap of only 10 percent ethanol into our nation's gasoline," he says. "[We] need government to raise it in order to let us move forward in clean green energy."

The Letter
Although Growth Energy's fuel waiver request may not have been directly impacted by these actions, Cischke's letter did spark a flurry of activity within the ethanol industry. In the letter, Cischke thanked Broin for meeting with Ford to discuss renewable energy. "As we discussed, biofuels continue to be a part of Ford's overall strategy to address energy security and climate change by increasing fuel economy and reducing emissions through the migration of advanced technology that is affordable and accessible for millions of our customers," she says in the letter.

Ford and Poet share a common vision to accelerate renewable fuels use, she continues, and Ford endorses efforts to increase base level blends up to E15. A document attached to the letter further highlighted some key points Ford would like to review with EPA regarding the support of appropriate use of renewable fuel, including the need to expand next generation ethanol production technologies.

Jennifer Moore, Ford's corporate news manager, clarifies that the letter expressed support for E15, but not endorsement at this point. "It would be premature to say we are endorsing a move now to higher blends of ethanol," she says. "What we endorse is collaborative efforts with key stakeholders to address concerns with the use of E15 in our legacy fleet. We need to overcome challenges related to higher levels of ethanol blends for all vehicles becausethe auto industry designed vehicles around an E10 blendWe are responsible for those warranties. How to deal with that is certainly still on the table." Cischke was not available to comment further on her letter to Poet.

According to the supporting document sent by Cischke to Broin, there are several main points Ford is focused on with regards to higher base blends of ethanol in the U.S. sector, including continuing support for the expansion of cellulosic ethanol and reinforcing a vision of ethanol becoming an alternative to gasoline - rather than being limited to a gasoline additive.

The document also endorses efforts to increase base level blends up to E15 and to collaborate with key stakeholders to address concerns regarding use of the fuel in the legacy fleet, while enabling the ethanol industry to expand production and distribution in order to meet energy security and economic goals.

According to the document, Ford also recommends establishing a firm planning horizon to support higher level base ethanol blends beyond E15. The automaker says this is necessary to provide adequate lead-time to design, develop and introduce vehicles that are compatible with higher base blends.

The Waiver
Buis says a move to E15 is necessary because it would create jobs, reduce our dependence on imported oil, help the environment and spur development of second generation technologies. "We think it would have tremendous impact," he continues. "Going from corn ethanol to cellulosic ethanol is a transformation process. It would create the gap necessary to have a marketplace for cellulosic ethanol."

"Going to 15 percent would create 130,000 new green collar jobs, provide about $25 billion into the U.S. economy and displace 7 billion gallons of imported gasoline each year," Buis says. It would also reduce greenhouse gas emissions by 20 million tons each year, he continues, which is equivalent to removing approximately 3.5 million vehicles from the road.

According to Growth Energy, the United States needs to move to higher ethanol blends in order to keep pace with the Renewable Fuels Standard, which mandates the use of 36 gallons of renewable fuel by 2022. A cover letter accompanying the waiver request signed by Broin and Growth Energy Co-chairman Gen. Wesley Clark states that for all practical purposes, we have already reached the E10 blend wall. The letter further states that a saturated E10 market is a primary reason for the U.S. ethanol industry's current financial condition, and that delaying action in removing the blend barrier would hinder the viability of current ethanol plants and set back the development of viable second-generation fuels.

Buis emphasizes that the waiver application does not seek to mandate the use of E15. Rather, it seeks to remove barriers to its use. Broin and Clark's letter also states that E15 is simply a first step that would solve the blend wall problem in the short term. A path allowing for E15 now, E20 by 2015 and E30 by 2019 would solve the immediate need to overcome the blend wall, while allowing time for appropriate studies and technological developments to occur prior to the introduction of higher level blends.

EPA's Potential Pathways
The EPA is required to take action on the waiver request within 270 days of its receipt. Statutes require the agency to establish a public docket for the petition that was submitted for Growth Energy and issue a Federal Register notice to take comments on the waiver application.

On April 1, EPA's Director of the Office of Air and Radiation Margo T. Oge submitted a written statement to the U.S. Senate Subcommittee on Clean Air and Nuclear Safety regarding the fuel waiver request. In her statement, Oge described three potential pathways EPA believes can be taken in order to meet the RFS.

One option cited by Oge is through the increased use of flex-fuel vehicles and increased availability of E85 across the nation. A second option would be through the use of non-ethanol renewable fuels that do not face the same blending limitations as ethanol. The third option would be to approve the use of a midlevel ethanol blend for use in conventional vehicles.

In considering Growth Energy's waiver request, EPA must determine that a move to higher level blends will not cause or contribute to the failure of any vehicle or engine emissions control system or device. The agency must also evaluate the impact of E15 on drivability and durability. The long-term impacts of E15 must also be considered.

In her statement, Oge says that one key issue regarding the E15 waiver is whether the waiver should be granted in whole in a conditional manner. This means EPA could restrict use of E15 to a subset of gasoline vehicles or engines, which may result in the need to alter fueling infrastructure, such as new pump labeling requirements.

Growth Energy's waiver application includes a wide variety of research designed to address the issues EPA must consider. According to Buis, EPA could use that research to approve the use of a lower blend of ethanol, such as E12 or E13, while the agency considers the E15 waiver request.

"I am confident that the ethanol industry will be part of a long-term energy solution and key to our independence," Buis says. "The technological gains that we are making both in cellulose and in reducing energy costs to produce ethanol and the gains in the reduction of carbon emissions will certainly help us make our case to keep moving forward."

Erin Voegele is an Ethanol Producer Magazine associate editor. Reach her at evoegele@bbiinternational.com or (701) 373-8040.