In boon for farmers, Trump to lift restrictions on ethanol

It’s welcome news in Iowa, a critical political battleground state.

Associated Press

By Matthew Daly / Associated Press

WASHINGTON — The Trump administration is moving to allow year-round sales of gasoline with higher blends of ethanol, a boon for Iowa and other farm states that have pushed for greater sales of the corn-based fuel.

President Donald Trump is expected to announce he is lifting a federal ban on summer sales of high-ethanol blends during a trip to Iowa on Tuesday.

“It’s an amazing substance. You look at the Indy cars. They run 100 percent on ethanol,” Trump said at the White House before he left for Iowa.

He said he wants more industry and more energy and he wants to help farmers and refiners.

“I want more because I don’t like $74,” Trump said referring to the current price of a barrel of crude oil. “It’s up to $74. And if I have to do more — whether it’s through ethanol or another means — that’s what I want. I want low prices.”

The long-expected announcement is something of a reward to Iowa Sen. Chuck Grassley, who as Senate Judiciary Committee chairman led a contentious but successful fight to confirm Brett Kavanaugh to the Supreme Court. The veteran Republican lawmaker is the Senate’s leading ethanol proponent and sharply criticized the Trump administration’s proposed rollback in ethanol volumes earlier this year.

At that time Grassley threatened to call for the resignation of the Environmental Protection Agency’s chief, Scott Pruitt, if Pruitt did not work to fulfill the federal ethanol mandate. Pruitt later stepped down amid a host of ethics investigations.

A senior administration official said Monday that the EPA will publish a rule in coming days to allow high-ethanol blends as part of a package of proposed changes to the ethanol mandate. The official spoke on condition of anonymity ahead of Trump’s announcement.

The change would allow year-round sales of gasoline blends with up to 15 percent ethanol. Gasoline typically contains 10 percent ethanol.

The EPA currently bans the high-ethanol blend, called E15, during the summer because of concerns that it contributes to smog on hot days, a claim ethanol industry advocates say is unfounded.

In May, Republican senators, including Grassley, announced a tentative agreement with the White House to allow year-round E15 sales, but the EPA did not propose a formal rule change.

The senior administration official said the proposed rule intends to allow E15 sales next summer. Current regulations prevent retailers in much of the country from offering E15 from June 1 to Sept. 15.

Lifting the summer ban is expected to be coupled with new restrictions on trading biofuel credits that underpin the federal Renewable Fuel Standard, commonly known as the ethanol mandate. The law sets out how much corn-based ethanol and other renewable fuels refiners must blend into gasoline each year.

The Renewable Fuel Standard was intended to address global warming, reduce dependence on foreign oil and bolster the rural economy by requiring a steady increase in renewable fuels over time. The mandate has not worked as intended, and production levels of renewable fuels, mostly ethanol, routinely fail to reach minimum thresholds set in law.

The oil industry opposes year-round sales of E15, warning that high-ethanol gasoline can damage car engines and fuel systems. Some carmakers have warned against high-ethanol blends, though EPA has approved use of E15 in all light-duty vehicles built since 2001.

A bipartisan group of lawmakers, many from oil-producing states, sent Trump a letter last week opposing expanded sales of high-ethanol gas. The lawmakers called the approach “misguided” and said it would do nothing to protect refinery jobs and “could hurt millions of consumers whose vehicles and equipment are not compatible with higher-ethanol blended gasoline.”

The letter was signed by 16 Republicans and four Democrats, including Texas Sen. John Cornyn, the No. 2 Republican in the Senate, and Utah Sen. Orrin Hatch, a key Trump ally. New Jersey Democratic Sen. Robert Menendez, whose state includes several refineries, also signed the letter.

A spokeswoman for the Renewable Fuels Association, an ethanol industry trade group, said allowing E15 to be sold year-round would give consumers greater access to clean, low-cost, higher-octane fuel while expanding market access for ethanol producers.

“The ability to sell E15 all year would also bring a significant boost to farmers across our country” and provide a significant economic boost to rural America, said spokeswoman Rachel Gantz.

Talk to us

More in Herald Business Journal

Overall property value increases 5.5% in Snohomish County

In the assessor’s annual accounting, Lakewood School District residents saw the biggest average uptick: 8.1%.

FAA concludes three days of test flights of Boeing’s 737 Max

Multiple steps remain before the plane can get the green light to carry passengers again.

COVID-19 and CHOP could benefit Snohomish County real estate

An estimated 40% to 55% of work formerly performed in an office building will be done remotely by 2025.

Somers: There are no current plans to move back to Phase 1

Such a decision would require a significant, sustained spike in hospitalizations and deaths, he says.

Alaska Airlines could ban non-masked flyers from travel

Noncompliant passengers will be told it is their “final notice” and a written report will be made.

Report: Boeing fell short in disclosing key changes to Max

Engineers did not know how powerfully the flight-control system could push the plane’s nose down.

Norwegian scraps $10.6 billion deal for Boeing Max, 787 jets

The decision covers 92 of Boeing’s Max narrow-body planes and five of the long-distance Dreamliners.

Re-certification flights begin in Seattle for Boeing 737 Max

The tests will evaluate the proposed changes to the plane’s automated flight control system.

Report: Virus could slow Canadian shopping in Washington

Concerns about public health and safety could continue to inhibit Canadians from shopping in the U.S.

Flight tests of grounded 737 Max planned to begin Monday

Such tests are one of the final stages by the government before it certifies an aircraft.

Fishers now qualify for federal loan amid economic downturn

The rule change comes after captains discovered crew members weren’t included in the 1st aid program.

Boeing starts 777-X test flights in Moses Lake

Test operations are based in Everett and there is no plan to “overnight at Grant County International.”