Responding to "Putin’s Price Hike", US President Joe Biden has announced new steps to spur the development of homegrown biofuels seen as critical to expanding Americans’ options for affordable fuel in the short-term and to building real energy independence in the long term.
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President Biden announced that the US Environmental Protection Agency (EPA) Administrator is planning to allow E15 gasoline—gasoline that uses a 15 percent ethanol blend—to be sold this summer.
The announcement was made on April 12, 2022, during a visit to the POET Bioprocessing facility in Menlo, Iowa (IA).
It is the latest step in expanding Americans’ access to affordable fuel supply and bringing relief to Americans suffering from Putin’s Price Hike at the pump while spurring the production of homegrown biofuels.
EPA to issue national E15 emergency waiver
E15 is currently offered at 2 300 gas stations in the country. To make E15 available in the summer, the EPA is planning to issue a national, emergency waiver.
Without this action, E15 cannot be used in most of the country from June 1 to September 15, and the EPA plans to take final action to issue the emergency waiver closer to June 1.
In implementing this emergency fuel waiver, EPA will work with states across the country to ensure there are no significant air quality impacts through the summer driving season.
EPA is also considering additional action to facilitate the use of E15 year-round, including continued discussions with states who have expressed interest in allowing year-round use of E15 and considering modifications to E15 fuel pump labeling.
An emergency waiver can help increase fuel supplies, give consumers more choice to get lower prices and provide savings to many families.
At current prices, E15 can save a family 10 cents per gallon of gasoline on average, and many stores sell E15 at an even greater discount.
Release oil reserves
The President’s announcements build on the steps taken in recent weeks to address the Putin Price Hike and bring relief to Americans at the gas pump.
This includes working with allies and partners through the International Energy Agency (IEA) to authorize a historic release from petroleum reserves around the world, putting 240 million barrels of oil on the market in the next six months—more than one million barrels per day.
The President called for a “use it or lose it” policy to make oil companies pay fees on wells from their leases that they haven’t used in years and on acres of public lands that they are holding without producing.
Enabling energy independence by boosting homegrown biofuels
The President put forward concrete steps to promote real independence from fossil fuels by accelerating the transition to clean energy, ranging from incentives for electric vehicles (EVs) to Defense Production Act authority for large capacity batteries to a new partnership to reduce European reliance on natural gas.
The announced actions also reinforce the Biden-Harris Administration’s goal of achieving real energy independence and commitment to a long-term strategy to spur smart development and adoption of sustainable, homegrown biofuels.
The Administration has previously announced the following key steps:
- US$700 million for biofuels producers: As part of the Pandemic Assistance for Producers initiative, USDA will provide up to US$700 million in funding through a new Biofuel Producer Program (BPP). The Program will support agricultural producers that rely on biofuels producers as a market for their agricultural products. By making payments to producers of biofuels, the funding will help maintain a viable and significant market for such agricultural products. Producers can expect awards before the end of April 2022.
- US$5.6 million for infrastructure via the Higher Blends Infrastructure Incentive Program: To expand the infrastructure for renewable fuels derived from agricultural products, USDA is announcing US$5.6 million in grants through the Higher Blends Infrastructure Incentive Program (HBIIP). The purpose of the program is to significantly increase the sales and use of higher blends of ethanol and biodiesel. The awards will support 9 projects in 7 states.
- US$100 million for Biofuels Infrastructure: Investing in biofuels infrastructure ensures that market opportunities are available for sustainable fuel sources—and that those sustainable fuels can reach consumers. The USDA US$100 million funding will provide grants to refueling and distribution facilities for the cost of installation, retrofitting, or otherwise upgrading of infrastructure required at a location to ensure the environmentally safe availability of fuel containing ethanol blends of E15 and greater or fuel containing biodiesel blends B20 and greater. USDA will also make funding available to support biofuels for railways as a means of assisting with supply chains and helping to reduce costs for consumer goods and transportation.
- Spurring a new market in Sustainable Aviation Fuels: The Administration announced new actions to support sustainable aviation with a focus on low-carbon fuels that will create economic opportunities for agricultural communities. This included a new Sustainable Aviation Fuel Grand Challenge to inspire the dramatic increase in the production of sustainable aviation fuels to at least 3 billion gallons per year by 2030; New and ongoing funding opportunities to support SAF projects and fuel producers totaling up to US$4.3 billion; and an increase in R&D activities to demonstrate new technologies that can achieve at least a 30 percent improvement in aircraft fuel efficiency.
- Expanding the use of canola oil: EPA is also announcing efforts to expand supply and choices for other forms of fuel, such as diesel and jet fuel. The Agency is proposing a new approval for canola oil that will add new pathways for fuels to participate in the Renewable Fuel Standard (RFS) program to provide renewable diesel, SAF, and other fuels. This action demonstrates EPA’s commitment to approving new petitions for renewable fuels that can provide greenhouse gas (GHG) benefits as well as reduce reliance on petroleum fuels.
Welcomed by biofuel bodies
In a statement, the Renewable Fuels Association (RFA) welcomes President Biden’s announcement that his administration will act quickly to ensure American consumers have uninterrupted access this summer to E15.
Giving fuel retailers the freedom to offer E15 this summer will not only result in lower fuel prices for hardworking Americans, but it will also cut greenhouse gas emissions and reduce tailpipe pollution linked to cancer, heart disease, respiratory illnesses, and other health concerns. As our nation copes with energy price inflation and strives to enhance energy security and diversity, we salute President Biden for turning to America’s farmers and biofuel producers for ingenuity and solutions, said Geoff Cooper, President, and CEO of RFA.
Likewise, American Coalition for Ethanol (ACE) CEO Brian Jennings noted that President Biden’s announcement is “great news for the ethanol industry, farmers, and most importantly, American consumers, who are under financial stress from rising energy prices and expenses.”
E15 is saving families between 10 and 30 cents per gallon, so this is a meaningful step toward reducing gas prices. We appreciate the President making it clear the farmers and biofuel producers who produce American-made ethanol are part of the solution to address pain at the pump, Brain Jennings said.
In recent months, E15 has typically sold for 15–25 cents per gallon less than standard gasoline with 10 percent ethanol (E10), and 60–80 cents per gallon less than gasoline with no ethanol added (E0).
In the absence of the actions announced by President Biden, most fuel retailers would have been forced to stop selling lower-cost E15 to their customers on June 1, as a result of an oil industry lawsuit.
Given the long-term importance of ensuring uninterrupted availability of E15 year-round in all parts of the country, we look forward to working with the administration and Congress on a permanent remedy to expand consumer access beyond the emergency measures being taken this summer, said Brian Jennings.