• EPA Proposes Year-Round Sales of E15 and Limits to RINs Trading

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    Wednesday, March 13, 2019 – Yesterday, the EPA proposed regulatory changes to allow gasoline blended with up to 15 percent ethanol (E15) to take advantage of the 1-psi Reid Vapor Pressure (RVP) waiver for the summer months that has historically been applied only to E10.

    The proposed rule is important to petroleum marketers because it would allow the year-round sale of E15 blended gasoline. Currently, E15 may only be sold during the winter driving season because it can’t meet federal summertime Reid Vapor Pressure (RVP) requirements for evaporative emissions. The proposed rule would change all that by extending the existing one-pound waiver allowed exclusively for E10 to E15 blends. If this happens, E15 will meet summertime RVP standards and can be sold year-round, underground storage tank and vehicle compatibility concerns notwithstanding.

    Extending the one-pound RVP waiver to E15 through the rulemaking process is controversial because the statutory language of the Clean Air Act specifically limits the waiver to E10 blends. Consequently, opponents of E15 argue that any such change can only be made by Congress through the legislative process, specifically by amending the Clean Air Act. Despite this hurdle, the Trump Administration is directing the EPA to make the change through the proposed rulemaking. In the meantime, E15 opponents will likely sue to prevent the rule from taking effect. While PMAA supports all forms of motor fuels, serious compatibility issues with UST systems and vehicles must be resolved before E15 can be safely sold year-round.

    Yesterday, EPA also proposed changes in the trading and holding of biofuel credits, called renewable identification numbers (RINs), in an effort to stabilize the RIN market by limiting speculation.

    Proposed reforms to RIN markets include: prohibiting certain parties from being able to purchase separated RINs; requiring public disclosure when RIN holdings exceed specified thresholds; limiting the length of time a non-obligated party can hold RINs; and increasing the compliance frequency of the program from once annually to quarterly.

    EPA will hold a public hearing on the proposals on March 29th in Michigan.

    For more information on the proposed rulemaking, please click here.

    PMAA Counsel is reviewing the proposal and will provide a deeper dive soon. PMAA will also submit comments to EPA prior to the April 29th deadline.

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