President Trump has directed the EPA to loosen restrictions on the ethanol mix in summer gasoline, a move that could potentially increase smog and almost certainly provide a boost for corn farmers.
The president announced his plan at a rally in Iowa on Tuesday. Iowa is the largest corn producer in the country.
U.S. ethanol, primarily derived from corn, is an octane-boosting additive that oil refiners must mix up to 10 percent in each gallon in order to comply with the Renewable Fuels Standard. Trump is not expected to change this law, which was adopted in 2007 and set a target of 36 billion gallons of ethanol by 2022. The change would allow summer gasoline to contain more ethanol-potentially up to 15 percent-between June 1 and September 15. Currently, those are the dates during which retail stations must sell fuel with lower vapor-pressure levels; this is to prevent gasoline from evaporating during hotter temperatures, which can cause smog-forming emissions like ground-level ozone. Ethanol increases vapor pressure (more on that here), which is why the Environmental Protection Agency has strictly mandated summer gasoline blends since 1989.
One benefit to consumers: Gas prices could drop in the summer, whereas now they typically rise because refiners are mixing more expensive additives to lower their vapor-pressure levels. Ethanol is a relatively cheap additive, and if refiners are allowed to use more with less regard to lowering evaporative emissions, prices could follow suit.
But it's not so simple, and likely, this won't be allowed nationwide. There are at least 14 unique summer blends sold throughout the country, and many metro areas deemed by the EPA as high-ozone "attainment areas" are allowed to set lower vapor-pressure requirements than nationwide minimums and extend the sale of these fuels into the colder months. Since ethanol is both required and yet restricted in summer fuel, the EPA allows refiners to take credits for using ethanol at 10 percent blends even though they technically exceed the limit. Many states, including the entire Northeast seaboard from Delaware to Maine, don't allow any exceptions for ethanol and likely would push back on any changes under their current federal exemptions.
The EPA is expected to publish a proposal this week.
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