The standard -- -- often referred to as RFS 2 -- -- mandates blending of up to 36 billion gallons of renewable fuel into U.S. gasoline by the year 2022.
In a 40-page decision, the Court of Appeals for the District of Columbia rejected all issues raised by the petroleum interests... which means RFS 2 will go forward as implemented by the Environmental Protection Agency.
But it seems that every victory won by renewable fuels proponents these days is accompanied by a new challenge. That was the case again this week, when a coalition of major automakers sued the EPA over its authorization of 15 percent ethanol in gasoline.
In mid-November, an alliance of food groups that included the Grocery Manufacturers Association and the National Pork Producers Council, filed suit against EPA. This unlikely alliance claimed the 50 percent increase from E10 to E15 would adversely affect the price of food and livestock feed.
This week, another legal action was brought against EPA. A partnership of automobile and small engine manufacturers became part of the long list of groups joining forces to stop higher blend-rates of ethanol in America's gasoline. The Automobile Manufacturers Association --which includes America's Big-Three automakers and Japan's Toyota -- along with the International Automobile Association and the National Marine Manufacturers Association banded together as the Engine Products Group to stop E-15 from being made available. Officials with the group say they represent 400 million engine products used by tens of millions of people. They are concerned the increased amount of ethanol will cause engine damage or failure as a result of accidental fueling of older vehicles not approved for E15.
In response to the lawsuit, the Renewable Fuels Association and Growth Energy, the two major ethanol promotion agencies, fired back.
According to the Renewable Fuels Association, the EPA could have "avoided this kind of market confusion by following all the science to its logical conclusion and allowing the use of E15 for ALL cars and light duty pickup trucks." And Growth Energy CEO Tom Buis said, "Concerns about misfueling are premature, as EPA is drafting a robust labeling rule and will conduct a vigorous public education campaign." Buis went on to say E15 is safe, not only for newer vehicles, but also for ALL passenger cars and trucks on the road today.
A larger issue looming on the horizon is fuel consumption. Both Government and industry officials agree U.S. gasoline demand peaked in 2006, and has been declining for the past four years. Experts are predicting that by 2030, U.S. drivers will use 34 percent less gasoline than today. This reduced consumption --coupled with standards mandating the use of 36 billion gallons of biofuels by 2022 – will make one in every four gallons burned a biofuel. In this scenario, oil companies will be losing an equivalent of 25 percent of the market to biofuels instead of the current 10 percent.
Much of the future decrease in gasoline usage can be attributed to mandatory increases in fuel efficiency, a concurrent decrease in the amount of miles driven and a steady increase in the amount of biofuels required by the EPA. If realized, U.S. motorists will consume 5.4 million barrels of gasoline per day by 2030 – levels not seen since 1969.