The Environmental Protection Agency (EPA), by law, has until Dec. 1 to issue a decision on a request to increase the ethanol blend percentage for non-flex-fuel vehicles from the current 10 percent maximum to up to 15 percent. Growth Energy and 54 ethanol manufacturers petitioned the EPA last March to allow gasoline to contain up to 15 percent ethanol by volume.

Over the past few months, Informa has quoted usually reliable sources on this topic. Based on those reports, the EPA has been reviewing various options including:

·        No change in the current 10-percent maximum

·        An increase to 12 percent

·        An increase to 15 percent

·        Limiting any increase to cars built from 2004

·        Making any increase effective when further studies are completed

Many sources have indicated EPA wants more studies completed on the impacts of a higher blend, including the impacts on engines with 120,000+ miles, but some studies are ongoing and will not be complete until spring/summer 2010 (the studies are on how the higher blend rate would affect engines, including cars, trucks, snowmobiles, motor boats and lawnmowers). While reports indicate EPA has been “impressed” with the information provided by groups supporting a blend percentage increase, liability concerns and expected court challenges (and a possible injunction) regarding any percentage increase have made EPA and lawyers cautious. Some believe EPA will announce an increase but it will not be effective until further studies on engines over 120,000 miles are available in spring. If so, this may help with the liability issue. (The Alliance of Automobile Manufacturers said granting any increase could cause catalytic converters to fail at around 50,000 miles [they are supposed to last for 120,000 to 150,000 miles]. The concern is that auto warranties may be voided by any blender increase.)

Support for ethanol reaches high levels in the Obama administration. USDA Secretary Tom Vilsack was an early supporter of a blend percentage increase. President Barack Obama during the presidential campaign and since his administration began has been an avid supporter of renewable fuels, especially ethanol. Whether that lofty support can overcome the entrenched EPA concerns remains unclear.

If the EPA grants an increase, it would not likely take effect immediately. If the EPA denies an increase, those supporting a boost just could resubmit their request and a 270-day decision clock would be reset, which could allow time for some ongoing studies to be completed, reducing some lawyer concerns.