EPA Releases Mandate to Lower Ethanol Levels in Gasoline

Ethanol, once seen as the key to solving high gas prices and environmental concerns, may be on its way out of fashion.

Last Friday, the Environmental Protection Agency released a statement that they will seek to lower the levels of ethanol in gasoline for 2014. If the mandate becomes law, it will be the first time that the levels of biofuels in our gasoline will be decreased.

The mandate proposes adding between 15 billion and 15.52 billion gallons of ethanol to the fuel supply in 2014. This is a reduction of roughly three billion gallons from the requirement set out for 2014 by the Energy and Security Independence Act of 2007.

Additionally, EPA also proposes decreasing the production of advanced biofuels, which are made from less refined material like woody crops or agricultural waste. The mandate recommends decreasing these fuels to a range of 2 billion and 2.51 billion gallons, instead of the target of 3.75 billion gallons for 2014.

In the not too distant past, ethanol and other renewable fuels were seen as the wave of the future. Ethanol is produced from corn, which is easy to grow and is an established crop in the United States. Ethanol can also be produced from cane sugar. It is mixed with gasoline to limit our use of environmentally-degrading fossil fuels. Meanwhile, biodiesel is made from vegetable oil and can be used to power a converted diesel engine and be used as heating oil.

Biofuel technology promised a reduced dependency on foreign oil and a more environmentally-sustainable way of running our cars. Indeed, it seemed a much better alternative to the mainstream means of energy, not just for the environment but also for consumers, who were becoming more and more vexed by rising oil prices. This preference for ethanol meant a big win for agribusiness, which could secure a large portion of the energy market in addition to government subsidies.

However, recent research indicates that ethanol may not be the godsend we once thought it was. Environmental groups warn that the production of more corn and the process of creating ethanol actually does more damage to the environment, including habitat destruction and water contamination. Food prices have also risen around the world due to increased demand for corn and soybeans, which are the building blocks of renewable fuels.

The petroleum industry has also conducted research on the effects of ethanol on our car engines. Currently, our automotive engines can run only on a fuel mix containing ten percent ethanol, while any more would cause damage. While some vehicles are equipped to handle the higher levels of ethanol, most car engines simply don’t have the technology at this time.

Meanwhile, renewable fuel producers that this reduction set forth by the EPA will cause huge losses for corn farmers and biofuel processors. This in turn could mean a loss of jobs and capital as well as diminished investment in research in renewable energy.

EPA in response has pledged to work towards safeguarding the market for research into creating better renewable energy solutions.

The mandate will have a 60-day public comment period once it is published in the Federal Registry. EPA expects to have a finalized version ready by the spring of 2014.

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