Oil Refineries Sue EPA over Ethanol Plan

January 3, 2011 - 5:54 PM

Washington (AP) - A ruling by the Obama administration allowing the sale of gasoline containing 15 percent ethanol is running into legal hurdles from trade groups opposing the plan.

The National Petrochemical and Refiners Association sued the Environmental Protection Agency on Monday over the decision to allow the sale of gasoline containing higher blends of corn-based ethanol, the second major group to protest the ruling.

The Obama administration said in October that gas stations could start selling the ethanol blend for vehicles built since the 2007 model year, increasing it from the current blend of 10 percent ethanol. The decision has been criticized by boosters of ethanol who say it doesn't go far enough and by engine manufacturers who contend it could damage engines in vehicles, boats, snowmobiles and outdoor power equipment such as lawnmowers and chainsaws.

The refiners group asked a federal appeals court to overturn the decision, arguing that the EPA does not have the authority under the Clean Air Act to approve a plan for fuels used in some engines but not others. The trade association also said EPA based its decision on new data submitted shortly before the ruling, failing to give the public a chance to review it.

Charles T. Drevna, the NPRA's president, said Monday the EPA had "acted unlawfully in its rush to allow a 50 percent increase in the amount of ethanol in gasoline without adequate testing and without following proper procedures." His group was joined in the lawsuit by the International Liquid Terminals Association and the Western States Petroleum Association.

EPA declined to comment on the lawsuit. The agency has said a congressional mandate requiring increased ethanol cannot be met without the higher blends. Congress has required refiners to blend 36 billion gallons of biofuels, mostly ethanol, in automotive fuel by 2022.

The EPA is expected to consider the higher ethanol blends for vehicles built from 2001-2006 this year.

Last month, trade groups for the auto industry and engine manufacturers sued EPA over the ruling, citing concerns it would lead to motorists unknowingly filling up their older cars and trucks with E15 and damaging the vehicles' engines. Opponents say the problem, called misfueling, could intensify if E15 fuels are cheaper than more conventional blends, prompting owners of older vehicles to use the fuel despite future engine problems.

The ethanol industry says the EPA should have approved the ethanol blend for more vehicles. They say there is enough evidence to show that a 15 percent ethanol blend in motor fuel will not harm engine performance.

Matt Hartwig, a spokesman for the Renewable Fuels Association, said the lawsuits "only serve to delay the inevitable" and that increased ethanol use "is the only proven and abundantly available tool to reduce our reliance on imported oil today."

The lawsuits have been filed in the U.S. Court of Appeals for the District of Columbia Circuit.