The Path to Higher Blends—Artificial Barriers Limiting Us to 10 percent

by Doug Durante, Clean Fuels Development Coalition

Last month’s column on the concerns we see with the RIN system concluded that we would look at pathways to higher blends so we would not be captive to the RFS. When I say captive, I say so in the sense that it has been very difficult to get beyond 10 percent blends because we have seen the RFS volume requirements become a ceiling rather than a floor. Those of us who had been involved in the creation of the RFS had always hoped that the 15 billion gallons that corn ethanol can qualify for would be a minimum that we would always have in a worst-case scenario. We would be free to produce more ethanol and to use it in blends above 10 percent.

That clearly has not happened. While almost all gasoline now contains 10 percent ethanol, we are easily producing enough that the base gasoline in the United States could absorb at least 12-15 percent. And, if the market was wide open, we would be able to blend to whatever level desired. With the exorbitant price of premium gasoline, a 30 percent ethanol blend for example might be quite attractive to independent retailers and even some major refiners. As our friends at Glacial Lakes Energy have clearly demonstrated, a 30 percent blend is substantially lower in cost and has proven to be trouble free in conventional vehicles. But, widespread adoption of higher blends has been elusive and there are several fundamental barriers.

First is the fact that a puzzling interpretation of existing law that applies a vapor pressure waiver to 10 percent blends is somehow assumed by many to mean ONLY 10 percent blends. Having been around long enough to have been part of these original regulations, I can say with certainty that no one envisioned ever having so much ethanol that we would go beyond 10 percent volume. So, the rule went into effect defining allowable blends as 10 percent. As a quick refresher, while ethanol is a clean, high-octane additive, one of its few demerits is that it raises vapor pressure when added to gasoline, resulting in a slight increase in evaporative emissions. However, its chemical property as an oxygenate results in greater combustion of the fuel which in turn results in much lower tailpipe emissions. Those reductions greatly outweigh any emissions from the vapor pressure increase so the waiver from vapor pressure restrictions was allowed.

As we tried to use higher blends beginning with E15 the petroleum industry – primarily refiners, with some on the retail side – argued existing law meant only 10 percent and somehow, inexplicably, won that argument. This, despite the fact that the law states the waiver applies to fuel “containing 10 percent ethanol” and we argued E15 contains 10 percent ethanol. Furthermore, and this is even more mindboggling, the vapor pressure increase peaks at 10 percent and starts to come down after that so there is no credible, technical argument against allowing it for all blends. As the volume of ethanol increases, at the point it reaches 30 percent, there is no vapor pressure increase at all!

So, the first obstacle is man-made, namely the refining industry, with an assist from EPA. The issue has been ping-ponged back and forth in the courts and while EPA did promulgate a rule only after intense political pressure, it did not hold up. This is terribly frustrating because it should not be an issue at all since there is no emission increase. With every increment of ethanol, the octane increases and every gallon of ethanol that displaces a gallon of gasoline improves the carbon footprint of the fuel – higher octane, lower carbon, at a lower cost yet the refining industry fights it at every step.

The second obstacle has been the auto industry – not so much in the sense that they have actively opposed higher blends but rather a combination of things ranging from lack of testing to warranty limits. Well-funded groups using oil industry money have helped to perpetuate fears and myths that emissions would increase and cars would suffer in terms of performance and efficiency.

There is no basis for limiting ethanol blends in conventional vehicles. Furthermore, there is every reason for automakers to embrace higher ethanol blends. Clean Fuels Development Coalition (CFDC) is a participant on the Ag-Auto-Ethanol working group that includes the auto industry. This group has had as a longstanding goal to unite behind 25 percent blends, and more recently up to E30. What is needed is an E30 certification fuel confirming it is substantially similar to straight gasoline or E10 blends. The auto industry has been reluctant to step forward and undertake necessary tests and certification protocols, often complaining of the cost and the concern that there would not be enough ethanol to make an E30 fuel viable. The result is the ability for them to say it is not an approved fuel and it doesn’t exist.

At CFDC, we have argued that there is no legislative or regulatory language we can find that prohibits the use of an E30 ethanol blend. In fact, we argue the burden of proof would be on EPA to prove such fuels either increase emissions or degrade performance.

If EPA truly supported the effort to use higher blends of ethanol, it could take on the task of certifying E30, meaning any blend up to that amount would be approved. Hopefully that would extend to warranties, making that a non-issue.

The Department of Energy was a participant in the original E15 waiver request and tested ethanol blended fuels in volumes of 20 percent. The emissions and performance results were all positive, so the data is there. New pumps are certified for blends up to 40 percent. Combine that with the real-world test results conducted by the state of Nebraska, and the hundreds of millions of trouble-free miles from the Glacial Lakes E30 challenge and there is no reason to limit our fuel to 10 and 15 percent blends.

E85 is a different situation. While technically it is a higher blend, it is used in flex-fuel vehicles (FFVs). Unfortunately, automakers do not produce FFVs with a few very select exceptions, so that is a limited market. In contrast, E30 can be used in conventional vehicles requiring no modifications. Then it gets really exciting to think about an E40 hybrid like they are unveiling in Brazil.

The answer to finding that pathway to higher blends and forcing all these peripheral issues to be resolved is to enforce the toxics provision in the Clean Air Act (CAA).

Introduced by then Sens. Tom Daschle and Bob Dole, the provision requires EPA to reduce toxic aromatic compounds in gasoline that are the source of octane. Ethanol is a readily available, cost-effective, low carbon octane alternative that refiners have resisted because they don’t make it. If that provision was enforced, it would effectively require ethanol, and all these related issues would need to finally be resolved by EPA. SDFU and NFU have joined CFDC in calling for EPA to do its job and we need that continued support as we pursue this pathway.

In future columns, we will look at the substantial benefits that would result from such action, particularly as they relate to the quest for carbon reductions that are driving so many fuel and transportation policies.