TitleOil industry loses legal battle over ethanol blend
BodyWASHINGTON — The Supreme Court dealt a big blow to the oil industry Monday, deciding not to hear a legal challenge of the federal government's decision to approve the sale of fuel containing 15 percent ethanol. The decision not to hear the case — which the high court issued without comment — was a defeat for the American Petroleum Institute and several other groups that have been fighting the Environmental Protection Agency's 2010 approval of the E15 blend. Although the agency green-lighted the sale of E15 for cars and trucks made since 2007, the higher-ethanol blend is not authorized for older vehicles. After the U.S. Court of Appeals for the District of Columbia ruled in January that the American Petroleum Institute and more than a dozen other groups did not have standing to challenge the EPA's limited approval of E15, the institute and other parties appealed to the Supreme Court. Harry Ng, the institute's vice president and general counsel, called the high court's move “a big loss for consumers, for safety and for our environment.” The oil industry argues that E15 has not been proved safe, that “misfueling” could cause filling station owners to face liability when the fuel is inadvertently pumped into older cars and that the market for the mix is limited, especially since some automakers have warned drivers that using the fuel will void warranties. Ng said the EPA was irresponsible in approving E15, “even though government research showed potential infrastructure concerns at our nation's gas stations that could lead to serious safety and environmental problems.” Charles Drevna, the head of America's Fuel and Petrochemical Manufacturers, charged that the EPA decision on E15 favored political considerations over science, and said the Supreme Court's decision “will have negative repercussions for consumers.” Biofuel backers cheered the decision. Tom Buis, the CEO of Growth Energy, which originally petitioned the EPA to approve the 15 percent blend, called the ruling “a true victory for the American biofuels industry” as well as consumers, the economy and the environment. Bob Dinneen, the president of the Renewable Fuels Association, said the Supreme Court's decision “ends a long and drawn-out petroleum industry effort to derail the commercialization of E15.” But while this legal fight may be over, the industry's larger war against an 8-year-old law mandating the use of more ethanol and other alternative fuels is just beginning. The oil industry is lobbying lawmakers to tinker with the 2005 renewable fuels standard or repeal it altogether. At the same time, oil companies and industry trade groups are asking the EPA to use its authority to waive some of the requirements. The House Energy and Commerce Committee has begun a broad, bipartisan review of the renewable fuel standard, ahead of possible changes. It is set to hold a hearing on the issue Wednesday. Some refiners say they already have reached what they call the “blend wall,” a threshold where adding the required volume of ethanol to gasoline supplies would result in ethanol blends exceeding the 10 percent cap approved for use in vehicles of any age. Because the renewable fuel standard sets target volumes rather than percentages, a recent decline in gasoline use means that blend wall has arrived sooner than expected. The effects vary among refiners, with their individual obligations determined by their share of the fuel market. Renewable fuel supporters say the mandate was designed to drive innovation in the fuels market and force changes by refiners, automakers and motorists — ultimately helping to wean the U.S. off foreign oil in exchange for domestically produced alternatives.
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