Once again, global oil prices are soaring on speculation that there may be yet another disruption of supplies due to conflict in the Persian Gulf. The damage to U.S. households and the economy is already significant. Yet at the same time, there is a glut of domestically-produced ethanol, and ethanol plants are shutting down production. Why not get this ethanol to market, get the industry back to work, and save consumers some money?
The ethanol glut reflects the fact that the fuel market is currently saturated at the E10 ethanol blend rate. The Wall Street Journal Market Watch and other news sources report that ethanol plants are shutting down or cutting production.
In January 2011, the EPA approved a higher E15 blend rate for light vehicles made in 2001 and later. On February 17, 2012, the EPA found that data submitted by the biofuels industry satisfied the emissions and health effects requirements for registering E15 fuel. Under the normal process, fuel blenders may now apply to register their E15 fuel blends with EPA. Then the fuel must be approved by state and local environmental agencies.
Getting this higher blend to market will help get the industry back to work and will encourage the deployment of new, advanced biofuel, cellulosic ethanol plants. However, at the present regulatory pace, it could take more than a year before anyone sees E15 at a gas pump. In the meantime, the price of gasoline is already up $0.25 per gallon since the beginning of the year, and many expect the price to pass $5.00 per gallon by summer if the Iran crisis is not peacefully resolved.
Already ethanol is saving consumers money – about $0.90 per gallon compared to what the price of gasoline would be without the E10 ethanol blend, according to Secretary of Agriculture Tom Vilsack . It seems like consumers and the economy could use more of that.
Doesn’t it make sense for the President and Congress to do all they can to get E15 to market faster?