Oil companies press House to cap ethanol blend below 10 percent

An ethanol plant stands next to a cornfield near Nevada, Iowa. (AP Photo/Charlie Riedel)
An ethanol plant stands next to a cornfield near Nevada, Iowa. (AP Photo/Charlie Riedel)

The fight over the federal ethanol mandate that has pitted corn farmers and oil refineries against one another is not taking a break now Donald Trump is heading to the White House.

Executives from BP Fuels and Marathon Petroleum were in Washington this week meeting with political leaders about legislation that would cap the amount of ethanol that could be blended below the so-called blend wall of 10 percent.

“There’s 117 cosponsors right now, and we we want to continue to build support on the Hill,” said Doug Sparkman, chief operating officer of British Petroleum Fuels North America.

Compared to straight gasoline, ethanol adds an octane boost for engines. But at a certain concentration – called the blend wall – the fuel mix burns so hot that it could damage a standard car engine not configured for higher ethanol blends.

Where exactly that point is has been a long running source of debate.  In a 2011 study the U.S. Department of Energy declared it was safe to use gasoline mixed with up to 15 percent ethanol on cars manufactured in 2001 or later. But many oil companies balk at those results, and have released their own study showing anything above 10 percent can damage cars.

“The only study that suggests contrary results was paid for by the American Petroleum Institute, and tested only 8 vehicles,” said Robert White, vice president of industry relations at the trade group Renewable Fuels Association.

Some gas station chains like RaceTrac and Murphy USA are going ahead and selling E15 gasoline for use in cars build after 2001.

But Rep. Bill Flores, R-Waco, and Rep. Peter Welch, D-Vermont, aren’t buying it. They introduced legislation in May capping the amount of ethanol sold in standard gasoline at 9.7 percent.

“The great thing about the Flores-Welch bill is there’s a recognition this bill is good for consumers,” said Don Templin, executive vice president of Marathon Petroleum Corp. “There will be higher fuel costs if the mandate goes ahead. People forget the automakers are not warranting the majority of cars in the fleet for more than E10.”

With ethanol production providing a crucial source of revenue to midwestern farmes, politicans from states like Iowa and Illinois have fought back efforts to weaken the ethanol standard – which came into effect close to a decade ago under President George W. Bush.

Where Trump would come down on the mandate remains to be seen. On the campaign trail, he said he’d protect the ethanol standard. But at one point his campaign posted a position paper stating Trump would repeal the credit system upon which the ethanol mandate runs – before promptly pulling it down, according to the news outlet The Hill.