The White House is set to greenlight a Midwest governors’ request for year-round sales of higher ethanol blends in gasoline, although the implementation date is postponed until next year, as reported by Reuters on February 20. This decision, while welcomed by the biofuel industry aiming to boost corn-based ethanol sales, may disappoint due to the delay until 2025. The administration’s move, which aligns with a request from several Midwest states, including key battlegrounds like Wisconsin and Minnesota, postpones potential localized price surges and supply disruptions, potentially shielding President Biden from electoral vulnerabilities related to inflation and the economy. The Environmental Protection Agency (EPA) is anticipated to issue a ruling by late March, with the effective date likely pushed from April 28, 2024, to 2025.

The proposal, allowing year-round sales of E15 gasoline, confronts environmental concerns over smog by the government’s restriction on E15 sales in summer. While the ethanol industry advocates for nationwide E15 sales expansion, the regional approach via the Midwestern governors’ request has sparked debate, with oil refiners expressing logistical complexities and spot shortage risks. The EPA’s impending decision comes amidst a push for a legislative solution favored by ethanol groups to enable expanded E15 sales nationwide, contrasting with the patchwork method proposed by the governors. Despite the delay, stakeholders anticipate a resolution soon, albeit amid ongoing interagency review processes, as the administration navigates a contentious intersection of energy policy, environmental considerations, and electoral dynamics.

Sources:

https://www.reuters.com/world/us/biden-administration-approve-e15-gasoline-expansion-starting-2025-sources-say-2024-02-20/