WASHINGTON — The U.S. Environmental Protection Agency issued a last-minute emergency waiver to allow E15 gasoline to be sold nationwide this summer. This was the fourth straight year the waiver was implemented.
“This action will provide Americans with relief at the pump from ongoing market supply issues created by Russia’s unprovoked war in Ukraine by increasing fuel supply and offering consumers more choices at the pump,” according to the EPA.
“The waiver will help protect Americans from fuel supply crises by reducing our reliance on imported fossil fuels, building U.S. energy independence and supporting American agriculture and manufacturing. Current estimates indicate that on average, E15 is about 25 cents a gallon cheaper than E10.”
Without the waiver, E15 — a 15% ethanol blend — could not be sold from terminals starting on May 1 and at retail stations as of June 1 during the summer in about two-thirds of the United States.
The EPA move provides relief by extending the 1-psi Reid Vapor Pressure waiver that currently applies to E10 gasoline to E15, which will enable E15 sales throughout the summer driving season in these areas, if necessary.
This action only extends the 1-psi waiver to E15 in parts of the country where it already exists for E10.
E15 can already be sold year-round in parts of the country that have a Reformulated Gasoline program.
Because the RVP of E10 and E15 gasoline used by consumers will be the same — both will be 1 psi higher than otherwise required by EPA or state regulations — EPA does not expect any impact on air quality from this limited action.
EPA’s research has shown no significant impact on evaporative emissions when the 1-psi waiver is extended to E15.
“With no significant impacts on emissions from cars and trucks, we expect consumers can continue to use E15 without concern that its use in the summer will impact air quality,” the EPA stated. EPA’s emergency fuel waiver went into effect on May 1 when terminal operators would otherwise no longer be able to sell E15 in the affected regions of the country and will last through May 20 which is the statutory maximum of 20 days.
EPA will continue to monitor the supply with industry and federal partners, and the agency expects to issue new waivers effectively extending the emergency fuel waiver until such time as the extreme and unusual fuel supply circumstances due to the war in Ukraine are no longer present.
“The Biden-Harris administration is committed to protecting Americans from fuel supply challenges resulting from the ongoing war in Ukraine by ensuring consumers have more choices at the pump,” said EPA Administrator Michael Regan.
“Allowing E15 sales during the summer driving season will not only help increase fuel supply, but support American farmers, strengthen U.S. energy security and provide relief to drivers across the country.”
The Clean Air Act allows the EPA administrator, in consultation with Department of Energy, to temporarily waive certain fuel requirements to address shortages.
As required by law, EPA and DOE evaluated the situation and determined that granting the waiver was in the public interest.
Oil Production Outlook
The EPA sent a letter on May 1 to governors whose states are impacted by the waiver that referred not only to the ongoing war in Ukraine and its impact on global crude oil supplies, but also OPEC’s unexpected reduction in crude oil output by 1.16 million barrels per day, “further constraining the market.”
This follows previous reduction in crude oil output announced by OPEC members in November 2022, for a total reduction of 3.66 million barrels per day, representing about 3.7% of global crude oil demand.
“Refining capacity in the U.S. is also lower due to closures across the country,” the letter to governors continued.
“Since 2020, U.S. refining capacity has been reduced by nearly 1 million barrels per day, due to permanent closures of refineries stemming from low demand during the COVID-19 pandemic and damage from hurricanes and accidents.
“As of the week of April 14, U.S. refinery utilization was at 91% compared to an average of 90% in April 2022. Even while demand has accelerated in the U.S., exports of U.S. gasoline are at the highest levels of the last five years.
“Additionally, U.S. gasoline demand is relatively strong compared to the five-year season average. The four-week rolling average of U.S. product supplied of finished motor gasoline, which represents gasoline demand, for April 21, 2023, was approximately 8% above the five-year seasonal average and 4% above demand at the same time last year.”
EPA approved E15 in 2011 for use in all 2001 and newer vehicles, which account for more than 96% of vehicles on the road today.
“Retailers have increased availability of E15, often marketed as Unleaded 88, to offer consumers choice and lower fuel costs, as well as increase the fuel supply,” according to the National Corn Growers Association.
“E15 has been sold year-round via waivers for the past four years, but outdated regulatory barriers continue to hinder permanent full-market access to E15.”