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Boyden Gray & Associates
Boyden Gray & Associates is a boutique litigation and public policy firm, continuing C. Boyden Gray’s decades of service as counselor to presidents, business leaders, legislators, and regulators on matters of constitutional law, regulatory policy, and international affairs.
It’s 2027, and ethanol is stuck at 10%.
•No E25 certification fuel
•No re-interpretation of “substantially similar” for gasoline
•No RVP relief
•No R-factor correction
•No correction to ethanol emissions factors in MOVES2014
CAFE/GHG is getting more stringent.
EV (hybrid) market share is growing.
Vehicle costs are rising.
Premium gasoline costs are rising.
Our children aren’t driving.
It wasn’t President
Trump’s fault.
“We are going to ensure that any regulations we have protect and defend your jobs, your factories. We’re going to be fair. We’re going to be fair.” Remarks by President Trump at American Center for Mobility | Detroit, MI (Mar. 15, 2017)
It wasn’t President Trump’s fault.
It wasn’t EPA’s fault.
“That 15 billion gallon cap—maybe it needs to be reset above that. I think we need to consider as another example on a different topic high octane with respect to CAFE standards.” Audio: http://cdn.radioiowa.com/wp-content/uploads/2017/08/PruittReRFS.mp3.
It wasn’t Pruitt’s fault.
“With respect to the [RVP] issue, we are looking internally [at allowing] E15 to be sold throughout the year, a national waiver if you will . . . I very much hope that we can get there, it's just a matter of if the statute permits it or not.” https://www.agri-pulse.com/media/podcasts/76-daily-voice/play/8286-pruitt-has-hope-on-e15-waiver.
It wasn’t Pruitt’s fault.
“[A] higher octane, higher ethanol content test fuel:� “could help manufacturers who wish
to raise compression ratios to improve vehicle efficiency as a step toward complying with the 2017 and later light-duty greenhouse gas and CAFE standards.
� “could help provide a market incentive to increase ethanol use beyond E10.”
� “could . . . enhance the environmental performance of ethanol as a transportation fuel by using it to enable more fuel efficient engines.”
Tier 3 Final Rule, 79 Fed. Reg. at 23528-29 (2014).
It wasn’t OTAQ’s fault.
It wasn’t the engineers’ fault.
“Higher octane fuels permit higher compression ratios which directly improve efficiency. . . . [A] powertrain . . . optimized for a high-octane, mid-blend ethanol fuel . . . can simultaneously fulfill what the customer desires—performance and economy—while reducing the environmental impact.” Mercedes-Benz, Tier 3 Comments (2013).
“Ford supports the development and introduction of an intermediate level blend fuel (E16-E50), with a minimum octane rating of 91 anti-knock index (AKI) that increases proportionally as ethanol is splash-blended on top of the base Tier 3 gasoline emission test fuel.” Ford Motor Co., Tier 3 Comments (2013).
“GM supports the future of higher octane and higher ethanol content in order to provide a pathway to improved vehicle efficiency and lower GHG emissions.” Gen. Motors, Tier 3 Comments (2013).
The Autos knew what they needed.
Summary of ACEC Recommendations for SI Fuel (Priority Rank Ordered) 1. RON Recommended Target Value
1. Higher is better2. Phase out current Regular (91 RON) RON≥100
Midgrade (95 RON), and Premium (98 RON) Grades- includes sub-octanes in regions like Colorado.
2. Sensitivity S = (RON-MON)1. Phase out current range of sensitivity. 2. For now, higher is better for anticipated future engine pathways. S > 12 or MON < 883. More research is recommended to fully understand high values of S.
3. Sulfur1. Lower is better 10 ppm maximum2. Harmonize US sulfur maximum with regulations in Europe, Japan, and others.
4. Volatility1. Reduced regional variation in Drivability Index Reduce DI variation2. Reduced seasonal variation in Drivability Index3. Limit T90 to a maximum temperature
5. Properties governing Particulate Matter1. Lower (Particulate Matter Index) PMI is better. PMI < 1.52. Research in progress to determine overall robustness of PMI
6. Heat of Vaporization (HoV)1. For now, higher HoV is desirable for anticipated future DI engine pathways.2. More research is recommended to fully understand HoV, especially
to separate its RON-like effects versus other effects like volumetric efficiency. HoV ≥ current
Source: Arun Solomon, GM R&D, Engine Efficiency and Gasoline Fuel Properties
It wasn’t the refueling
infrastructure’s fault.
It wasn’t the refueling infrastructure’s fault.
The existing E25-capable refueling infrastructure is sufficient to support use of an E25 fuel:� E25-capable dispensers are already in the market in substantial
quantities and will continue to proliferate.� Blender pumps and FFV dispensers can also be used to sell E25.� Existing fuel dispensers can be retrofitted to dispense E25 at low cost.� Nearly all underground storage tanks are compatible with E25.� Studies show that only a small percentage of retail stations (10 to 20%)
need to offer the fuel to ensure convenient availability to consumers.
It wasn’t that the regulations were too hard
to fix.
EPA conceded in litigation that:
Until MY 2022, § 86.113-94(g), “allow[s] vehicle manufacturers to request EPA’s permission to use an alternative test fuel without specifying any substantive criteria, such as the proposed test fuel’s commercial availability.” EPA Brief at 3-4, 10 (emphasis added)
“Fuels not meeting the specifications set forth in this section may be used only with the advance approval of the Administrator.” 40 C.F.R. § 86.113-94(g)
It wasn’t that the cert fuel rules were too strict.
EPA conceded in litigation that:� EPA has discretion “to approve an alternative test fuel that is not
currently on the market.” EPA Response at 7 n.3, Energy Future Coalition v. EPA, No. 14-1123 (D.C. Cir.)
� After MY 2022, the reference to “commercial availability” in §1065.701(c) is forward-looking, asking how the new fuel is “going to be available on the market,” not whether it is currently available on the market. Oral argument transcript at 20 (emphasis added)
� That rule merely “codif[ies] the practice of the agency,” which has been to consider a new fuel’s potential to become commercially viable in the future. Transcript at 23
� EPA may approve a test fuel under § 1065.701(c) based on “future market projections.” EPA Response at 7 n.3 (emphasis added)
It wasn’t that the cert fuel rules were too strict.
Any automaker can apply for an alternative certification fuel.
� “anyone performing testing” of new vehicles for compliance with EPA’s emissions standards, including “manufacturers of engines, vehicles, equipment, and vessels”
� “anyone who does [emission] testing ... for such manufacturers” 40 C.F.R. 1065.1(c) (defining “you”)
It wasn’t that the cert fuel rules were too strict.
The Clean Air Act’s 1 psi waiver provision makes the RVP standard less stringent for all
“fuel blends containing gasoline and 10 percent denatured anhydrous ethanol.”42 U.S.C. § 7545(h)(4).
EPA interprets this waiver provision to apply only to gasoline with 9-10% ethanol. 40 C.F.R. § 80.27(d)(2).
It wasn’t that the RVP rule was too hard to fix.
But the very next subsection of the law makes clear that it applies to
“all fuel blends containing gasoline and 10 percent denatured anhydrous ethanol.” Id.§ 7545(h)(5).
It wasn’t that the RVP rule was too hard to fix.
The law also includes an affirmative defense for downstream fuel sellers when
“the ethanol portion of the fuel blend does not exceed its waiver condition under” the sub-sim law. Id.§ 7545(h)(4).
If Congress had wanted to limit the waiver to E10, it would have used more limiting language.
It wasn’t that the RVP rule was too hard to fix.
EPA’s former flouts Congress’s intent, because E15 has lower RVP than E10.
EPA: “[T]he addition of ethanol to gasoline” above 10 percent ethanol “decreases blend volatility.”
Source: NREL
It wasn’t that the RVP rule was too hard to fix.
“With respect to the [RVP] issue, we are looking internally [at allowing] E15 to be sold throughout the year, a national waiver if you will . . . I very much hope that we can get there, it's just a matter of if the statute permits it or not.” https://www.agri-pulse.com/media/podcasts/76-daily-voice/play/8286-pruitt-has-hope-on-e15-waiver.
It wasn’t that the RVP rule was too hard to fix.
� EPA is required to review and if necessary revise the MOVES model every three years.
� The errors in the ethanol emissions factors are well documented.
� The MOVES Review Work Group is currently reviewing the model.
It wasn’t that EPA’s modeling was biased against ethanol.
We were defeated by
our own scarcity mindset.
� The automakers stopped making FFVs without CAFE subsidies, despite low marginal costs.
� Automakers were slow to warrant the use of E15 in new vehicles, even after EPA’s partial waiver, with the exception of GM and Ford.
� Automakers chose not to follow Mini Cooper and the BMW X1 when they warranteed new vehicles for midlevel ethanol blends.
The autos traded long-term opportunities for small short-term gains.
“Fuels with a maximum ethanol content of 25 %, i. e. E10 or E25, may be used for refueling.” 2015 Mini Owner’s Manual 172, http://bit.ly/2utpieV
In reconsidering the Midterm Evaluation, EPA asked for comment on
“[t]he impact of the standards on advanced fuel technology, including . . . the potential for high-octane blends.” 82 Fed. Reg. 39551, 39553 (Aug. 21, 2017).
The autos were afraid to ask for octane.
“[T]he Alliance has long advocated transition to a higher-octane gasoline (minimum 95– 98 RON). There are several ways to produce higher-octane grade gasoline, and the Alliance does not advocate any sole or particular pathway. Higher-octane gasoline enables opportunities for use of key energy-efficient technologies, including higher compression ratio engines, lighter and smaller engines, improved turbocharging, optimized engine combustion phasing/timing, and low-temperature combustion strategies. . . . Generally, depending on its composition, high-octane fuel is ‘backwards compatible’ with existing vehicles.” Auto Alliance Reconsideration Comments (Oct. 5, 2017).
The autos were afraid to ask for octane.
Compare the Auto Alliance’s Tier 3 Comments:
Ethanol’s “in cylinder cooling effect” and high octane rating make a “mid-level gasoline-ethanol blend” particularly well suited for “improv[ing] vehicle efficiency and lower[ing] GHG emissions,” through “increas[ing] the engine compression ratio” and “downsizing of the engine.” Auto Alliance Tier 3 Comments at 52 (2013).
The autos were afraid to ask for octane.
Compare Ford’s Tier 3 Comments:
“Ford strongly recommends that EPA pursue regulations . . . to facilitate the introduction of higher octane rating market fuels,” Ford Tier 3 Comments at 3 (2013).
“increased octane rating from increased ethanol content has the potential to allow for fuel economy, performance and emissions improvements through more efficient engine designs.” Id. at 17.
“Progress on this issue will be a key parameter for consideration in [EPA and NHTSA’s] . . . mid-term evaluation” of the light-duty CAFE Rule in 2017. Id.
The autos were afraid to ask for octane.
� Promoting E15 � Maximizing RIN values under the RFS
Ethanol interests prioritized temporary subsidies over a permanent market.
� E25? E30? E40?� 98 RON? 100 RON?
Ethanol interests fought over details.
It’s not too late to change the future.
Automakers need to:
� Aggressively and vocally support high-octane midlevel ethanol blends while the deregulatory window is open.
� Promptly submit an alternative certification fuel application to EPA.� Warrant all new vehicles to use midlevel ethanol blends.
How to change the future
The ethanol industry needs to:
� Avoid temporary distractions and focus on removing regulatory barriers to midlevel ethanol blends.
� Avoid infighting, and support any positive steps toward high-octane ethanol blends.
� Participate in the MOVES Review Work Group.
How to change the future
