EPA says it is committed to rule for higher ethanol blend by summer driving season

[January 09, 2019]  By Jarrett Renshaw and Chris Prentice

NEW YORK/WASHINGTON (Reuters) - The U.S. Environmental Protection Agency said on Tuesday it would complete a rule to boost sales of higher-ethanol blends of gasoline by the summer driving season, despite a partial government shutdown.

The statement from the environmental regulator came after the agency warned at least two lawmakers that the shutdown had delayed its timeline for initially rolling out the rule, according to two sources briefed on the matter.

President Donald Trump pledged in the run-up to November's congressional elections to lift the summer ban on sales of so-called E15 gasoline, in a boost to an ethanol industry upended by trade wars and weak demand growth at home.

The Trump administration hoped to have the rule published by February and approved by June, but the EPA recently told lawmakers that the timeline would be delayed because of the partial government shutdown, said the two sources, who spoke to Reuters on condition of anonymity.

An EPA spokesman said the agency would still complete the rule before the summer driving season.

"This is a priority for both President Trump and Acting Administrator Wheeler. The ongoing partial shutdown will not impede EPA’s ability to keep to our deadline,” Michael Abboud said in an emailed statement in response to a request for comment. The acting EPA administrator is Andrew Wheeler.

The EPA currently bans the higher ethanol blend, called E15, during summer because of concerns it contributes to smog on hot days - a worry biofuels advocates say is unfounded. E15 gasoline contains 15 percent ethanol, versus the 10 percent found in most U.S. gasoline.

An empty podium awaits the arrival of U.S. Environmental Protection Agency (EPA) Acting Administrator Andrew Wheeler to address staff at EPA headquarters in Washington, U.S., July 11, 2018. REUTERS/Ting Shen

Trump's decision to lift the ban of summer sales of E15 was applauded by corn-belt farmers and lawmakers and criticized by the oil lobby as an illegal overreach by the EPA and its acting administrator.

The proposal is expected to be coupled with a slew of reforms to the credit-trading market that underpins the nation's renewable fuel policy.

Brooke Coleman, executive director of the Advanced Biofuels Business Council, said the EPA had been drafting the E15 proposal for a long time and should have no issues meeting its June 1 target. He said the EPA should delay the trading reforms if they are slowing the process down.

"That would keep the president’s promise to rural communities while taking some pressure off regulators," Coleman said.

(Reporting by Jarrett Renshaw in New York and Chris Prentice in Washington; Editing by Leslie Adler and Peter Cooney)

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