Push for E15 by ethanol producers as strong as ever - Trade Only Today

Push for E15 by ethanol producers as strong as ever

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“The farmers and the cowboys should be friends” goes the song from Broadway’s classic musical “Oklahoma.” But it sure doesn’t fit the boating industry and the ethanol producers.

While we, along with many other small engine and petroleum interests, lobby Congress for needed revisions to the outdated Renewal Fuel Standard and push the Environmental Protection Agency to reduce mandated ethanol volumes, the ethanol producers continue their relentless quest for more ethanol in gasoline.

Yesterday, the the House Energy and Commerce Committee's Environment Subcommittee held a hearing regarding the future of transportation fuels. Numerous panelists testified and during the hearing, Congressman Buddy Carter (R-GA) discussed the needs of boaters, the negative impact that E15 has on marine engines and the positive aspects of biobutanol. He asked if the needs of boaters were being kept in mind when fuel policy decisions are being formulated.

Late last month, White House meetings were held with President Trump by ethanol and oil industry groups and their respective senators, along with the heads of the EPA and the Agricultural Department. Trump was reportedly trying to encourage a deal between ethanol and refining supporters and two items reportedly captured the focus of negotiators: (1) a year-round waiver for selling E15; and (2) a cap for Renewable Identification Numbers (RINs), the credits refiners buy/sell and use to prove compliance to RFS blending quotas.

Concerning the E15 waiver, in most markets Reid vapor pressure (RVP) volatility restrictions currently prevent the sale of E15 to flex-fuel vehicles from June 1 to Sept. 15. It means most vehicles cannot buy the ethanol blend during the busiest driving period of the year protest the producers. Clearly, ethanol advocates see getting this restriction lifted is a key to E15’s greater growth.

“The president clearly saw the value of year-round E15,” Mike Lorenz, executive vice president of petroleum supply for Sheetz Inc., told CSP Fuels. “It frankly is a win-win-win. It’s a win for ethanol, a win for refiners, who, if you sell more E15, you will have more RINs available and that should bring down their price … and it’s a win for the consumer because they can buy the product year around, especially during the peak driving season.”

According to the ethanol industry lobbying group, Growth Energy, more than 1,300 fueling sites in 29 states now offer E15. The Sheetz chain leads the way with the greatest number of E15 sites in the nation, some 220 locations selling E15 and E85. Obviously, the implications of a year-round RVP waiver on E15 are big for Sheetz.

It’s also notable that Sheetz has made changes to how it markets the fuel. In the beginning, Sheetz labeled it as “E15.” Then, it was rebranded as “Unleaded 15.” Now Sheetz is rebranding it again as “Unleaded 88,” referring to the octane of the fuel. Sheetz claims it will clear up consumer confusion. And if you buy that logic, please stop and give yourself a forehead slap.

While there is great concern about America’s boaters mistakenly fueling with E15 now, the rebranding to “Unleaded 88” seems certain to bring confusion to a new level. Congressman Carter addressed this during his time before the subcommittee. According to Lorenz: “The consumer has no idea what E10 is even though that’s 97 percent of the gasoline sold in the U.S.” At the average gasoline pump, signage typically does not refer to the 10 percent ethanol blend as E10. Instead, it’s regular grade, with the octane rating getting higher play.

“That’s why we settled on Unleaded 88,” Lorenz added. “If you walk up to anyone on the street and say ‘What is unleaded?’—they know that’s gasoline. If you say ‘Unleaded 88’ they know 88 is the octane.” Seriously?

While Sheetz says it’s done adding E15 to its existing stores, it will be included in all new builds. As Lorenz says, “we’re looking to grow sales, and that will take some marketing.”

Not to be terribly cynical, but even if boaters do everything possible to protect themselves and their marine engines, what confidence can they have in any fuel provider that is obviously set on blowing a plume of smoke up the public’s kilt?

It a compelling reason for boating to continue to pursue Congressional changes to the RFS and petition EPA to reject expansion of the quantity of ethanol mandated annually in our gasoline supplies. 

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