In the last few weeks, the ethanol industry has suffered two major court case defeats. Earlier this month, the D.C. Court of Appeals struck down the Environmental Protection Agency (EPA) rule allowing for year-round sales of E15. In May 2019 the EPA issued a rule change ending a summer ban on the sale of E15 blend. Provisions of the Clean Air Act have prohibited the sale of certain fuels with a higher volatility from June 1 through Sept. 15, including E15. The court ruled that Congress did not intend to allow ethanol blends higher than 10% to be sold year-round and that the EPA overstepped its authority by implementing the change.
Not surprisingly, in response to the court ruling, a bipartisan group of lawmakers from major corn producing states introduced a bill Wednesday that aims to allow the year-round sale of gasoline containing 15 percent ethanol. U.S. Senators Amy Klobuchar (D-MN) and Deb Fischer (R-NE) and U.S. Representatives Angie Craig (D-MN) and Adrian Smith (R-NE) introduced bipartisan bills to permit the year-round sale of E15. The bill was cosponsored in the Senate by Tammy Baldwin (D-WI), Tammy Duckworth (D-IL), Dick Durbin (D-IL), Joni Ernst (R-IA), Chuck Grassley (R-IA), Roger Marshall (R-KS), Jerry Moran (R-KS), Mike Rounds (R-SD), Tina Smith (D-MN) and John Thune (R-SD). In the House Representatives, Cindy Axne (D-IA), Rodney Davis (R-IL), Dusty Johnson (R- SD) and Mark Pocan (D-WI) were all original cosponsors of the bill.
This legislation faces a tough road ahead in Congress with a diverse set of stakeholders and lawmakers opposed to increased ethanol mandates. The Motorcycle Riders Foundation applauds the court for striking down the year-round mandate and will work with like-minded groups to oppose legislation that would reopen the door to the year-round sale of E15.
Also in June, the U.S. Supreme Court ruled 6-3 in favor of a small Wyoming refinery that had previously been granted waivers from the EPA to comply with blending requirements of the Renewable Fuel Standard (RFS). The RFS, passed by Congress over a decade ago, recognized that small refiners face unique economic challenges to comply with ethanol blending requirements.
Congress delayed implementation of some requirements for small refiners and created a waiver process run by the EPA. During the Trump Administration the number of waivers given to refineries increased greatly and the ethanol industry sued to rescind some of the waivers. The decision by the Supreme Court last month opens the door for continued use of these waivers by refiners to avoid blending their fuel with ethanol.