EPA signals approval of higher-ethanol gas

The Environmental Protection Agency (EPA) said it would likely allow greater amounts of ethanol to be mixed with gasoline upon completion of additional tests, drawing a mixed response from the industry.

A final decision could come in June, EPA said.

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Raising the so-called “blend wall” has sparked a lobbying fight among ethanol makers that wanted it raised and automakers and other manufacturers that fear fuel sold with higher ethanol content could damage engines.

Fuel currently can’t contain more than 10 percent ethanol. Ethanol producers have argued higher blends are safe and would create more jobs in the industry.

In its announcement, EPA said new vehicles would “likely be able to accommodate higher ethanol blends, such as E15.”

But the agency said a final decision would not be made until it obtains results from further tests, including by the Energy Department on the long-term emissions impacts of higher ethanol blends.

The announcement drew a mixed reaction from ethanol producers.

Growth Energy, a trade group of producers, petitioned EPA to allow for more ethanol to be blended with gasoline.

“The announcement is a strong signal that we are preparing to move to E15,” said retired Gen. Wesley Clark, who is the co-chairman of Growth Energy.

But Bob Dinneen of the Renewable Fuels Association had a different take.

“The delay threatens to paralyze the continued evolution of America’s ethanol industry,” he said.

EPA also said that it was committed to increasing the use of renewable fuels. Congress has mandated that 36 billion gallons of renewable fuel be produced annually by 2022. In light of that requirement, EPA said it was “clear that ethanol will need to be blended into gasoline at levels greater than the current limit of 10 percent.”