Next Year, U.S. Intends to Sell Higher Ethanol Fuel Throughout the Year

U.S.: The Environmental Protection Agency recently announced the Biden administration’s plan of introducing year-round sales of E15 fuels in eight Midwest states. This move is expected to bring down retail fuel prices. However, due to a delay in finalizing regulations, the plan had to be pushed back until 2024. Implementing it too quickly in 2023 could cause significant disruption to consumer pricing. The good news is that E15 fuels will still be available for sale in 2024.

The Environmental Protection Agency (EPA) has imposed a ban on the sales of E15 fuel during the summer season to reduce the negative effects of smog. However, the ban was lifted last year to bring down the prices of fuel. Recently, research findings have been published, indicating that E15 fuels do not contribute significantly more to smog formation compared to E10 fuels that contain only 10% Ethanol. Some see the decision to allow year-round E15 fuel sales as a political victory for the Corn lobby since the top Corn producing states in the nation, such as Nebraska, Iowa, and Illinois, will now offer this type of fuel.

The EPA's approval of increased Ethanol blending mandates last year had a significant impact on the price of Corn and other crops, causing them to rise considerably. However, oil refiners are pushing back against the E15 mandates, which are cutting into their profit margins. According to the Renewable Fuel Standard (RFS), oil refiners are required to blend more renewable fuels into Gasoline and Diesel. Refiners who lack the infrastructure to blend biofuels must purchase RINs (Renewable Identification Numbers), which are expensive blending credits that can be traded. Small refiners can receive exemptions if they can prove that the cost of RINs is negatively impacting their revenue.