U.S. EPA Will Delay Midwest Ethanol Expansion in South Dakota, Ohio

By Stephanie Kelly

NEW YORK, Feb 28 (Reuters) – The U.S. Environmental Protection Agency said on Friday it would delay an action by one year to expand sales of higher ethanol blends of gasoline in South Dakota and Ohio, two of eight Midwestern states that requested the agency approve increased sales of the product.

The EPA’s statement on Friday follows its decision last week to uphold an April 28 implementation date for the request from eight Midwest governors to allow year-round sales of gasoline containing 15% ethanol, a blend known as E15. States had until February 26 to seek a one-year delay.

The EPA’s implementation will now only apply to Illinois, Iowa, Minnesota, Missouri, Nebraska, and Wisconsin – after South Dakota and Ohio opted for the delay.

The EPA’s expansion is meant to enable both E15 and the more widely available E10 fuel blends to be sold during the summer, where the existing policy often keeps E15 out of the market.

While biofuel producers have long wanted expanded sales of the E15 blend, they would prefer a nationwide solution that goes beyond just the Midwest region.

The oil trade group the American Petroleum Institute also prefers a nationwide policy, as some industry players worry a fragmented market could lead to localized supply disruptions.

Kansas, which was not among the eight states addressed in the final rule, had submitted a similar request to Ohio and South Dakota’s petition for a one-year delay, the EPA said on Friday.

“Earlier this month, (Kansas Governor Laura Kelly) expressed continued interest in a temporary Gasoline Volatility Waiver for the upcoming summer months as she has in previous years,” Kelly’s spokesperson Grace Hoge told Reuters.

“While Kansas did not request to be included in recent actions taken by other Midwest states, Governor Kelly remains committed to addressing this critical issue and will continue advocating for a federal solution that empowers consumers with the freedom to select their preferred fuel type.”

(Reporting by Stephanie Kelly; Editing by Marguerita Choy)