US President Joe Biden’s administration is reportedly set to provide a group of Midwestern governors the green light to conduct year-round sales of E15 gasoline, although it is only expected to start in 2025.
Two sources with knowledge of the matter stated that the White House would approve a 2022 request from 8 state governors, including Illinois, Iowa, Minnesota, Missouri, Nebraska, Ohio, South Dakota, and Wisconsin, to perform the sale of the gasoline with 15% ethanol beginning next year.
The US Environmental Protection Agency (EPA) may also release a temporary contract allowing such a transaction as necessary for the meantime.
The agency submitted a final review of the plan to Washington in December with an effective date of April 28, 2024. The updated schedule would move the effective date to 2025.
The administration is expected to announce a decision in March, according to the sources.
The EPA has not commented on the matter as the request remained under interagency review.
The decision could be pleasant news for the biofuel industry, which aims to broaden sales of corn ethanol, but the move to hold off the sale by a year may receive a different reaction.
The sources said a 2025 start date risks delaying the prospect of localized price gains and potential supply challenges due to the decision until after the US election.
Wisconsin and Minnesota are the swing states for the 2024 presidential election set to be held on November 5. The US inflation and economy are expected to be the weak spots for Biden’s possible reelection.
Expanded E15 Sales Scenario Still Filled with Uncertainties
US Agriculture Secretary Tom Vilsack expressed optimism over expanded sales of the higher-ethanol gas potentially occurring across the country next year. Until then, Vilsack expects the White House to issue temporary waivers this summer to permit sales.
Ethanol, a locally made corn-based alternative fuel, is more affordable than gasoline in volume, and using more of the product can reduce prices by driving overall supply higher.
However, the US currently prohibits selling E15 fuel during the summer season, which is around late June through September, citing environmental issues arising from smog.
For years, the ethanol industry has made efforts to have the E15 sales restrictions withdrawn across the country, claiming that the environmental problems have been presented more severely than they were in reality.
Still, the proposal from the Midwest has sparked some debate. Texas-based oil refineries HF Sinclair Corp. and Phillips 66 Co. have warned of fuel supply logistic difficulties and further risk a spot shortage if they take a patchwork approach to allowing sales of E15.
Ethanol groups have leaned more toward a legislative solution in the US to approve broader sales of the 15% ethanol gas than the regional method.
