June 21, 2010
EPA Delays Decision Until Fall on More Ethanol in Gasoline
Published in Wall Street Journal
WASHINGTON—The U.S. Environmental Protection Agency said Thursday it would delay until the fall a decision on whether more corn-based ethanol than the current 10% limit can be blended into gasoline.
An EPA statement, provided to Dow Jones Newswires, said more testing still needs to be conducted on cars to see how they run on a 15% ethanol blend, but preliminary results "look good," and U.S. Department of Agriculture officials called that good news for the ethanol industry.
A spokesman for the Renewable Fuels Association said the EPA's delay—the second since the EPA was petitioned about a year ago to push the limit up to 15%—was "disappointing."
But USDA Secretary Tom Vilsack said the EPA statement was a "green light" for the USDA to begin increasing support for the expansion of ethanol production and distribution.
"The EPA is taking a significant step forward by discussing their timeline to expand [gasoline with a 15% ethanol blend] to vehicles," Mr. Vilsack said in a statement. "This provides a roadmap to build a stronger domestic biofuels industry by creating a market to expand the use of ethanol in America."
Lifting the cap to allow a 15% ethanol blend is important to ethanol producers and corn farmers that provide the fuel feedstock, USDA Chief Economist Joe Glauber said recently, because demand is limited under the current 10% cap.
Mr. Glauber said he expects ethanol production this year to reach about 13 billion gallons and there is not much room for expansion beyond that. The "blend wall," or the maximum amount of ethanol that can be produced to meet demand, will be about 15 billion gallons per year.
The U.S. ethanol industry is expected to consume 4.55 billion bushels of corn, or about 35% of the 13.1 billion bushels produced in the U.S. last year, according ....
