On Friday, the Environmental Protection Agency’s approved  health effects testing on E15 fuel submitted by the Renewable Fuels Association (RFA) and Growth Energy.

Health effects testing is a required step in the approval of any new fuel or fuel additive.  With EPA’s acceptance of the results of the testing submitted by the ethanol groups, suppliers of ethanol and E15 are now able to register with EPA to offer the fuel.  This is not the green light for E15 sales yet, but the health effects testing is a significant milestone to have passed.

EPA concluded, “Our evaluation therefore concludes that RFA/Growth Energy has submitted data and analysis that would satisfy the Tier 1 and Tier 2 testing requirements for registration.”

“For three years Growth Energy has led the effort to clear the way for consumers to have access to affordable, renewable and cleaner-burning fuel. Now it is up to the retailers and individual fuel companies to register for approval to sell E15. With ethanol selling an average of 76 cents a gallon cheaper than gasoline and $4 a gallon gasoline on the horizon, we’d encourage all Americans to ask their local filling station how soon they will see more-affordable E15,” said Tom Buis, CEO of Growth Energy.

“EPA’s action today puts E15 on the precipice of commercialization and means that consumers may be able to choose a more affordable E15 option in time for the expensive summer driving season,” RFA President and CEO Bob Dinneen.  “Increasing America’s use of homegrown ethanol will create jobs, reduce harmful tailpipe emissions, and make this nation more energy secure.  This is huge step toward meaningful market expansion for domestically-produced ethanol.”

ACE Executive Vice President Brian Jennings says the decision makes E15 another step closer to the consumer.

“Americans are paying record high gas prices for this time of year and E15 could save drivers 12 to 15 cents per gallon versus straight gasoline. The sooner E15 emerges on the market, the sooner consumers will be able to choose between expensive and pollution-causing gasoline, and E15, a homegrown source of clean-octane at a remarkably affordable price,” Jennings said.

The acceptance of the health effects testing clears the way for the final steps in registering E15 as a fuel and offering it in the marketplace.  One step is to have ethanol and fuel companies register with EPA.  The RFA expects that to begin happening as early as this afternoon.

The other step is the formulation of a misfueling mitigation plan.  As the E15 waiver extends only to MY2001 and newer vehicles, and excludes a number of non-road, marine, and vehicle engines, helping ensure consumers are legally and appropriately using E15 is critical.  The RFA has submitted a misfueling mitigation plan to EPA that would serve as a model plan that fuel retailers must follow to be in compliance with EPA regulations.  Once this plan is completed, and companies register with EPA, E15 can be sold to the EPA-approved vehicles in states and at stations that are prepared to do so.

Sources: Renewable Fuels Association, Growth Energy, American Coalition for Ethanol

The Advanced Ethanol Council (AEC) urged Senate Ag Committee Chair Debbie Stabenow (D-MI) and Ranking Member Pat Roberts (R-KS) to include two key tax extensions for advanced and cellulosic ethanol producers.

In a letter to the committee leaders, AEC Executive Director Brooke Coleman wrote, “The Cellulosic Biofuels Producer Tax Credit (PTC) — created in the 2008 Farm Bill — and the Special Depreciation Allowance for Cellulosic Biofuel Plant Property are vital to the ongoing development of the domestic advanced ethanol industry.  … Several billion dollars have been invested in advanced biofuels development with the expectation that Congress will stay the course with regard to its commitment to the industry.  A tax increase on advanced biofuels at this time would curtail investment and undercut an industry just starting to close deals and break ground on first commercial plants.”

Beyond the tax extension, Coleman also highlighted four areas in which the Farm Bill could help accelerate the commercialization of advanced and cellulosic ethanol technologies.  These areas include:

• Extend the U.S. Department of Agriculture (USDA) Loan Guarantee program for biorefinery projects, but improve critical provisions of the program to more effectively facilitate participation by lending institutions.

• Support USDA’s efforts to build out ethanol refueling infrastructure via the Rural Energy for America Program to allow ethanol to compete in the market based on price.  This will facilitate market access that is critical to the ongoing development and deployment of advanced ethanol fuels.

• Reform the Biomass Crop Assistance Program to increase cost effectiveness and better encourage and reduce the risk of energy crop production for the advanced biofuel sector, including efforts to preserve the environmental benefits of land coming out of conservation programs by incenting sustainable energy crop production.

• Modify the Repowering Assistance program to help existing bio-refining operations deploy advanced ethanol technologies and feedstock utilization.

“We are aware that the funding available for new Farm Bill will be reduced significantly.  We look forward to thinking creatively with you about comprehensive solutions that reduce cost but continue to provide meaningful value to an emerging advanced ethanol industry.  We appreciate your ongoing support for the advanced biofuels industry and look forward to further discussion of this important matter,” Coleman concluded.

Source: Renewable Fuels Association