EPA raises amount of ethanol that must be blended with gas

DES MOINES, IOWA >> The Biden administration on Friday set new requirements that increase the amount of ethanol that must be blended into the nation's gasoline supply but reduce previous ethanol-blending requirements due to a plunge in fuel demand during the coronavirus pandemic.

The Environmental Protection Agency said it would set the 2022 levels for cornbased ethanol blended into gasoline at 15 billion gallons. But even as the new rules increased future ethanol requirements, the EPA retroactively reduced levels for 2020 by 2.5 billion gallons and by 1.2 billion gallons for 2021, reflecting the lower amount of ethanol produced and decreased sales of gasoline during a period when the virus led to a drop in driving.

Most gasoline sold in the U.S. contains 10% ethanol, and the fuel has become a key part of the economy in many Midwest states. The fuel consumes more than 40% of the nation's corn supply, and ethanol and other biofuel production plants offer jobs in rural areas that have seen steady population declines over the decades.

“Today's actions will help to reduce our reliance on oil and put the RFS program back on track after years of challenges and mismanagement,” said EPA Administrator Michael Regan.

TThe American Fuel & Petrochemical Manufacturers group, which represents refineries, called the 2022 figure “bewildering and contrary to the administration's claims to be doing everything in their power to provide relief to consumers.” The group said unachievable mandates will increase fuel production costs and keep consumer prices high.