EPA OKs Ethanol Options

Ruling would let stations sell 20 or 30 percent blends

By Peter Harriman
pharrima@argusleader.com

PUBLISHED: December 8, 2006

Gas stations have more options for marketing ethanol after a ruling by the Environmental Protection Agency.  The EPA has ruled that ethanol in concentrations of 20 and 30 percent can be sold from blender pumps and used in flexible-fuel vehicles.  The ruling is in response to an inquiry from the South Dakota Petroleum and Propane Marketers Association, which represents about 500 gas stations.

"My question concerns other grades of ethanol fuel (besides E85) and whether it is legal to offer those lesser grades for sale in motor vehicles through blender pumps," Dawna Leitzke, executive director of the association, wrote the EPA in October.  Margo Tsirigotis Oge, director of the EPA Office of Transportation and Air Quality, replied, "I am not aware of any federal law that prohibits sale of such blends for use in FFV's."

In response to customer requests, a few South Dakota fuel retailers took blender pumps - used to formulate various concentrations of Number 1 and Number 2 diesel fuel - and used those pumps to create E20 and E30 ethanol blends. The customers, for the most part, weren't using those ethanol blends to fuel FFVs, however, but cars and trucks certified to burn only E10.  The big question, whether E20 and E30 used in vehicles certified for E10 violates the Clean Air Act, remains unanswered, Leitzke said.  But by acknowledging it is legal to use blender pumps to sell various ethanol blends, the EPA helps ensure that larger question is getting closer to being asked.

Ron Lamberty, vice president of market development for the American Coalition for Ethanol, hailed the EPA ruling.  "That's terrific. To start out with, we have assumed that as long as those (blender pumps) were clearly marked for use by flexible-fuel vehicles, we were not in violation of any law. It's just nice to have that clarification," he said.  Beyond that, anything that deals with the use of E20 and E30 is helpful, Lamberty said. Now, 99 percent of U.S. ethanol is blended as E10.  "In the future, though, especially if this cellulosic ethanol takes off, we are going to need a market for about 30 to 40 percent" blends, Lamberty said.

Most ethanol in the U.S. is produced from corn, but research into using cellulose-based feedstocks such as switchgrass could greatly expand the production capacity of the ethanol industry.  There is no auto manufacturers' data on how ethanol in concentrations higher than 10 percent performs in engines designed to burn E10. Informally, motorists seem to have been testing that themselves.  "Before the blender pumps, customers would fill half their tank with E10, end their transaction, then fill the rest of their tank with E-85 and be on their way," Leitzke said.  The best way to test blender pumps' legality for ethanol sales is "for a couple of innovative marketers to say 'we're going to do this until somebody tells us to stop. Then we're going to ask for a ruling.'  "Now we've got it," Lamberty said.

Sen. John Thune and Gov. Mike Rounds helped press the EPA for a ruling, Leitzke said.