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Sunday, May 31, 2015

USA - More from MRF on Ethanol

May 29, 2015
From Jeff Hennie
Motorcycle Rider Foundation, Vice President Government Relations and Public Affairs
A quick, short recess week saw little congressional or regulatory action. On Friday, Obama’s Environmental Protection Agency (EPA) dealt what could be the beginning of the end for ethanol fuel growth. The EPA has been sitting on a proposal for a year and, half to lower ethanol requirements for oil refineries. The Renewable Fuel Standard (RFS) is a law passed by Congress that mandates the amount of ethanol to be included in the nations fuel supply. Each year the RFS ticks up a little bit, until now.
The EPA has proposed that levels be slashed in 2015 and 2016 to the tune of about four and five million gallons, respectively. The drop in production requirements has angered those in the ethanol production world, and delighted those who do not want more ethanol in the fuel stream.
As for motorcyclists, the news is encouraging; the less ethanol being required will mean that the smaller amounts of ethanol will have to be spread thinner. This in theory, removes the need to increase the blend to E15 levels. The EPA knows that ethanol is unpopular and cites this as the main reason to lower production requirements. The market has spoken, and it is not in favor of ethanol.
Starting this Monday the short-term highway bill countdown begins. The new extension expires July 31. Look for another extension this summer, unless someone finds $550 billion dollars lying around in the next 60 days.