Environmental Law Matters

On June 15, 2012, EPA approved the first applications for the use of E15 Ethanol/Gasoline blend. Since that time, a dispute has emerged regarding the potential benefits and problems associated with a transition from the current standard E10 blend to E15. The situation became more focused following EPA's issuance on March 29, of proposed rules referred to as the Tier 3 Vehicle Emissions and Fuel Standards. These rules, which are proposed to become fully effective in 2017, are intended to reduce gasoline sulfur levels by more than sixty percent (60%) and reduce smog-forming volatile organic compounds and nitrogen oxides by eighty percent (80%). As explained at The Ethanol Producer magazine's website, the rules assume a steady and eventually complete shift from E10 to E15 gasoline/ethanol blend. In this rule, EPA is essentially assuming the implementation of separate requirements imposed by the Renewable Fuel Standard enacted by Congress in 2007. That standard requires EPA to seek a higher amount of ethanol in gasoline on an annual or recurring basis. And while the requirement was intended by Congress to reduce dependence on foreign oil by encouraging renewal domestic sources of fuel components, the requirement is arguably having various unintended consequences. For example, a recent report from the Coordinating Research Council, Inc., indicates that various automobile engine components may not perform effectively or actually deteriorate with the use of E15. The higher ethanol content also is demonstrated to reduce vehicle mileage, thereby adversely affecting the ability to meet fleet mileage requirements being imposed by the government. The American Petroleum Institute has also raised fuel supply infrastructure concerns as a part of its opposition to a move to E15. Finally, the increased use of ethanol, which is produced primarily from corn, is diverting increasing amounts of corn from other uses, and correspondingly is attributed to increases in food prices. Although EPA announced the rule on March 29, and released a copy, the Agency did not announce the dates of the public comment period. According to the notice, the comment period will run for thirty days following publication of the draft in the Federal Register, so interested parties will need to monitor that publication or the EPA Tier 3 webpage linked above. For more information on environmental law topics, please contact one of the Burr & Forman team members for assistance. We are happy to answer any questions or concerns you may have.