Soaring Gas Prices? E15 Is Here to Help

By Published On: April 12, 2022Categories: Daily Market News & Insights

While the price of gasoline at the pump has decreased significantly since the start of the Russia-Ukraine conflict, Americans are still paying much more than they would like to when filling up their cars. With the current national average of $4.098 reported by AAA today, people are still looking for answers. To help curb this continued problem, the Biden administration is set to announce today that E15 gasoline will be available for purchase.

In alignment with the Environmental Protection Agency (EPA), Biden is expected to make this announcement sometime today. E15 Gasoline has a 15% ethanol blend, higher than the typical “up to 10% ethanol” blend contained in regular 87-octane gasoline. The EPA currently allows E15 sales during the fall/winter months, but restricts its sales in the summer because of tight fuel vapor requirements known as Reid Vapor Pressure, or RVP. Blends of E15 and higher may have slightly higher vapor levels during the summer, contributing to smog. However, in light of significantly higher prices, the Biden administration is waiving the requirement. Navigating this release can be tricky given that there must be emergency waivers released by the EPA, but it is expected the EPA’s decision is final and will be effective June 1 as the summer months and vacationing period start.

Around 2,300 gas stations across the US currently sell E15 gasoline. Expanding this number will give Americans more opportunity to choose what fuel to buy. The additional 5% of blended ethanol can save consumers around 10 cents per gallon, though E15 blends are also a bit less energy dense. Fuel demand can rise by 50-100 million gallons per day in the summer, so this waiver will allow renewable fuels to fill some of the increased demand. Opponents of the measure argue that higher ethanol blends can be corrosive to engines, and that the increased smog could be an environmental hazard. The announcement is a huge win for renewable suppliers, who have been pushing for higher ethanol blends for years. It will also help suppliers achieve their Renewable Volume Obligation targets more readily and at lower costs.

This article is part of Daily Market News & Insights


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