Biden admin scraps eco-friendly fuel rules as gas prices remain high

The Biden administration is scrapping environmental rules regulating the quantity of ethanol that refiners are able to mix into gasoline, which are designed to reduce smog during the summer.

In a final rule published by the Environmental Protection Agency (EPA), the agency granted a 2022 request from eight Midwestern governors, led by Iowa Gov. Kim Reynolds, to allow gas stations in their states to sell 15% ethanol blend fuel year-round. So-called E15 fuel is generally less expensive than regular blend fuel with less ethanol content, but it is prohibited from being sold during the summer months because it produces higher amounts of smog.

An EPA official confirmed in a statement to Fox News Digital that it is removing a federal waiver that has for years required gasoline-ethanol blends containing 10% ethanol to be used in the summer in Illinois, Iowa, Minnesota, Missouri, Nebraska, Ohio, South Dakota and Wisconsin. The action will take effect in 2025, a timeline that was criticized by refiners as too soon and by renewable fuel proponents as too late.

"After continuous delays by the EPA to allow year-round sales of E15 fuel, consumers across the country can finally look forward to lower-cost, cleaner-burning year-round E15 in 2025," Reynolds said in a statement. "Nearly two years ago, I organized a bipartisan coalition of eight Midwest governors to join me in challenging the EPA’s refusal to allow E15 sales during summer months."

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Environmental Protection Agency Administrator Michael Regan, left, speaks as President Biden looks on Feb. 16, 2024, in East Palestine, Ohio. (AP Photo/Andrew Harnik)

"Finally, our request is approved, however, the EPA’s unjustified delays come at a cost for drivers and the environment," the Iowa governor continued. "As governor of the nation’s top ethanol producing state, I’m pursuing a waiver to continue offering drivers the option to purchase lower-cost, cleaner-burning E15 in Iowa this summer, and I won’t stop fighting for year-round E15 until it’s available nationwide."

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In April 2022, Reynolds led a bipartisan coalition of governors — including Govs. JB Pritzker of Illinois; Laura Kelly of Kansas; Tim Walz of Minnesota; Doug Burgum of North Dakota; Kristi Noem of South Dakota; and Tony Evers of Wisconsin, and former Nebraska Gov. Pete Ricketts — in formally requesting that EPA Administrator Michael Regan allow year-round sales of E15 fuel in their states.

The coalition, whose state economies account for more than 10% of U.S. gasoline sales, invoked the federal Clean Air Act that gives governors the authority to make such a request. They argue that renewable fuels are the "immediate solution to high gas prices, lower emissions, and restoring our energy independence."

Republican Iowa Gov. Kim Reynolds speaks at the Family Leadership Summit on July 14, 2023, in Des Moines, Iowa. (Scott Olson/Getty Images)

"While we are pleased to see EPA has finally approved year-round E15 in these eight states, we are extremely disappointed by the Agency’s needless decision to delay implementation until 2025," Renewable Fuels Association CEO and President Geoff Cooper said Thursday. "It’s helpful to finally have some certainty about 2025 and beyond, but what happens this summer?"

"The Biden administration missed its statutory deadline to finalize the governors’ petition by more than 500 days, and now it claims there just isn’t enough time to implement the rule in time for summer 2024," he added. "Why should ethanol producers, farmers, fuel retailers, and consumers in these states be penalized for EPA’s foot-dragging and failure to meet a clear deadline?"

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The Renewable Fuels Association and bipartisan lawmakers have called on the federal government to permanently allow year-round sales of E15 fuel, arguing such an action would help ease gas prices nationwide.

President Biden announces a temporary waiver allowing the nationwide sale of E15 in the summer at POET Bioprocessing in Menlo, Iowa, on April 12, 2022. (AP Photo/Carolyn Kaster, File)

President Biden acknowledged as much in April 2022 when he issued a nationwide waiver allowing summer E15 sales in response to the Ukraine war, which roiled global energy markets, saying at an event in Iowa that, as a result, Americans are "not going to show up at your local gas station and see a bag over the pump that has the cheapest gas." However, the action was only temporarily effective in 2022.

The EPA's actions Thursday, though, received criticism from the American Fuel & Petrochemical Manufacturers (AFPM), the nation's largest industry association representing petroleum refiners. The group said the rule change could impact overall fuel supplies and lead to higher costs.

"E15 is about 10 cents a gallon cheaper than E10, and some gas stations offer an even bigger discount than that," President Biden remarked during an event in Iowa in April 2022. "You’re going to be able to keep filling up with E15. And it’s going to solve a whole problem." (AP Photo/Susan Walsh)

"We’ve made clear to the administration that it’s too late for 2024 implementation and even 2025 would be problematic," said AFPM Senior Director of Fuels and Vehicle Policy Patrick Kelly. "Refiners start making the switch to summer production very early in the year and to minimize costs, there must be a reasonable transition to producing summer gas according to a different specification."

"Studies show that even with at least a two-year lead time, the RVP change will reduce overall supply, increase costs and make the region more vulnerable to supply disruptions. With less time, costs to produce and supply fuel and risks of supply disruptions could be greater."

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Meanwhile, gasoline prices across the country have remained stubbornly high, hitting $3.27 per gallon as of Friday, according to AAA data. Those prices represent a 6% month-over-month increase and are nearly 37% higher than pump prices when Biden first took office.