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Wed September 19, 2012
Gas with more ethanol available at some pumps
Head to your local filling station and you might see a new blend of gas at the pump. After a three-year regulatory process, the Environmental Protection Agency approved E15 – gas made with 15 percent ethanol – this summer.
Most gas we pump is already blended with ethanol, sometimes it contains as much as 10 percent, but the ethanol industry fought hard to bring E15 to the market. For ethanol backers and the farmers who feed the ethanol industry, getting drivers to pump gas with 50 percent more ethanol is a big win.
You might see E15 at your local gas station, but you might not. While renewable fuel advocates worked for years to win federal approval for E15, even in in Corn Country the E15 pickings are slim.
In July, the Zarco 66 gas station in Lawrence, Kan., became the first station in the country to offer E15 directly to consumers and for a while, it was the only one.
The locally owned Phillips 66 looks like any old filling station. And it is, for the most part. It has an island oasis theme, complete with steel drum music and “Hurricane” car washes, and a convenience store that sells sodas and sandwiches.
The normal-looking gas station, though, is a trailblazer when it comes to renewable fueling. Largely, that’s because its owner, Scott Zaremba, says he has been interested in renewable fuels for years.
As the first station to offer the new fuel, the Zarco 66 in Lawrence is functioning as a guinea pig for both the ethanol and fuel industries. That’s an exciting prospect for Zaremba. And he realizes that it might be a while until E15 gains widespread acceptance.
“It’s going to take a little time in order to implement E15,” Zaremba said. “There are some other hurdles that we have to overcome.”
Thanks to EPA’s approval process, individual state regulations and opposition from much of the auto and oil and gas industries, the E15 roll-out has been slow.
Some car manufacturers say using E15 could hurt car engines and void car warranties. In fact, they joined with the grocery and oil and gas industries to sue the EPA, arguing that the ruling could artificially boost food prices and make gas stations liable for customers whose car warranties are voided. A federal appeals court dismissed the suit, saying the trade groups presented only speculative and indirect claims.
Ken Peterson, director of the Kansas Petroleum Council, said the EPA’s approval of E15 was a mistake. The Kansas Petroleum Council is a field office of the American Petroleum Institute, which represents the oil and gas industry and supported the lawsuit.
“In many cases, some of the car manufacturers have specifically said in their owners’ manuals ‘Do not use blends above E10 in the vehicles,’ Peterson said. “It’s just a case of buyer beware.”
The issues and critics haven’t deterred Zaremba.
“We see it being something that can move out throughout the rest of the United States,” Zaremba said. “Somebody has to be the first and somebody has to show that we can get it done.”
Though just in its infancy, ethanol advocates hope to see big things from E15. Yes, Zaremba says, going from 10 percent ethanol to 15 percent may not seem like much, but if E15 catches on, the ripple effects could be huge.
“It expands our ability in order to have domestically produced transportation energy,” Zaremba said. “If you take 5 percent and place that in our entire feedstock we can have an impact on the importation of foreign oil.”
The EPA approved E15 for use in cars that are already on the road – drivers don’t have to have a special car or special engine. According to the EPA, all you need is a car that was built since 2001.
More gas stations can start selling E15 Sept. 15 when seasonal air quality restrictions on gasoline ease. The question is, will they?
Zaremba already had the right pumps to make E15 work and stations in Nebraska and Illinois are expected to follow suit quickly. In Iowa, a huge corn and ethanol state, the Iowa Renewable Fuel Association put up billboards touting E15’s arrival in the state.
It makes sense that farm country would embrace more ethanol more quickly. After all, most of their ethanol comes from just down the road.
Zaremba’s gas stations buy their ethanol from East Kansas Agri-Energy, an ethanol plant about an hour south of Lawrence. It looks like a bustling highway rest stop with a factory plopped on top of it – trucks pulling in and out, dropping off corn and picking up ethanol. Truckers drive the ethanol back up to Zaremba’s gas stations and mix it with gasoline so customers can pump it in to their cars.
Steve Gardner, the general manager of the ethanol plant, said his plant makes about 110,000 gallons of ethanol every day after grinding about 40,000 bushels of corn, which the plant buys from nearby farmers.
“I don’t expect this thing to just explode,” Gardner said. “But obviously, now that we have it rolled out, we’ll be putting together some detailed plans as to how we get more of this offered to consumers.”
Though just a handful of gas stations are expected to offer E15 this month, Gardner says it’s an important first step.
“The typical consumer hears these interviews and reads it in the paper and that’s all the exposure they’ve had up until this point,” Gardner said. “Now, they can actually feel it and touch it at the pump.”
Sure, some drivers may now be able to feel and touch E15. But will they pump it?
This story originally aired as part of Business Beat, a weekly program about business and economics in mid-Missouri.