US senators seek to expand sales of ethanol-gas blend with support from Big Oil

By Stephanie Kelly

(Reuters) – U.S. senators reintroduced a bipartisan bill on Tuesday that would allow nationwide sales of gasoline with a higher blend of ethanol year-round, with the support of a leading oil trade group.

Republican Senator Deb Fischer from Nebraska and Democratic Senator Amy Klobuchar from Minnesota argue that the expanded sales of E15, or fuel containing 15% ethanol, would decrease gasoline prices and reduce U.S. dependence on foreign oil. Year-round sales of E15 have been long sought by the biofuel industry and corn farmers, who would benefit from the increased market.

The American Petroleum Institute (API), one of the largest U.S. oil trade groups, supported the bill when it was introduced last autumn.

The API began cooperating with a biofuels trade group on expanded nationwide E15 sales after governors from major corn-producing Midwestern states requested the U.S. Environmental Protection Agency (EPA) lift restrictions on E15 in their states, Reuters previously reported.

The governors effort raised oil industry concerns that the proposal would create a patchwork of different fuel regulations and logistical challenges around distribution.

The governors proposal is gaining headway. In response to their request, the EPA in early March proposed to allow year-round E15 sales in those states. That rulemaking would take effect in the summer of 2024 and still needs public comment.

“Our bipartisan legislation is the only permanent, nationwide solution to unleashing the power of year-round E15,” Fischer said in a statement about Tuesday‘s bill. “It’s why weve been able to bring together a diverse group of stakeholders from the oil/gas, biofuel, (agriculture), and transportation sectors to support our legislation.”

The EPA restricts summertime sales of E15 over concerns that it contributes to smog in hot weather, though research shows the higher percentage blend may not increase smog relative to the 10% blend called E10 that is sold year-round.

(Reporting by Stephanie Kelly in New York; Editing by Lisa Shumaker)