Senators ask FTC to Investigate E15 issue

[jake75]

WStJ 8-22-13 The Federal Trade Commission said it was looking into assertions by some members of Congress that oil companies are using their influence over retail gas stations to block consumers from accessing gasoline blended with extra ethanol.

The inquiry underscores the deepening divide between the renewable-fuels industry, which wants to promote "E15" gasoline containing 15% ethanol, and the oil industry, which says consumers don't want E15. Oil producers and refiners are pressing Congress to repeal the U.S. law that requires refiners to use ever-greater amounts of corn ethanol and renewable fuels.

Sen. Amy Klobuchar (D., Minn.) and Sen. Chuck Grassley (R., Iowa) called for the FTC inquiry, saying they had reports of oil companies pressing independent gas stations to sell premium gasoline in addition to regular gasoline.

Since most stations own only two storage tanks, such a demand would make it impossible for gas stations to offer higher ethanol blends without installing a new tank, said the senators, both of whom are from states where ethanol is produced.

"Given the implication these alleged activities…could have on competition in the marketplace, we urge you to investigate them and consider whether any action is necessary," they said in an Aug. 2 letter to the FTC that described the oil companies' alleged actions as a possible antitrust violation.

The FTC said in a letter released Wednesday that it would look into the issue. It didn't indicate it was opening a formal investigation. The Justice Department hasn't yet responded to the lawmakers' request, according to Mr. Grassley's staff.

A spokesman for the American Petroleum Institute, which represents oil producers, said the allegations are "a distraction from the fact that the [renewable fuels standard] is broken."

The American Fuel & Petrochemical Manufacturers, which represents refiners, said it is reviewing the senators' letter and didn't have immediate comment.

A 2007 renewable fuels law forces refiners to blend a certain number of gallons of renewable fuel into gasoline each year. The 2013 standard requires the use of nearly 17 billion gallons of renewable fuel, most of which is corn ethanol.

The oil industry and other critics have questioned the wisdom of the law in recent months as overall gasoline consumption fails to keep pace with lawmakers' expectations. Refiners say the law forces them to use more renewable fuel than is physically possible given that most gasoline contains only 10% ethanol—a problem known as the blend wall.

The Environmental Protection Agency has approved the use of 15% blends for newer cars but E15 hasn't become popular with consumers. According to the Renewable Fuels Association, roughly 30 stations in eight states offer the 15% blend.

Renewable fuels companies say oil companies are trying to block the use of E15. The Renewable Fuels Association, a lobbying group for the industry, says it knows of at least one Kansas station owner who was allegedly pressured by an oil company to stop offering E15.

Oil companies say E15 hasn't taken off because consumers don't want it and because they say it poses a risk of damage to cars in some cases. The American Petroleum Institute says the renewable-fuels law is "broken beyond repair" and has urged Congress to repeal it. The group has also asked the EPA to lower the mandate for ethanol use in 2014, and the EPA has said the mandate is under review.

House lawmakers are considering bills to amend the renewable fuels law but it is unclear what they will propose or whether there is enough support in Congress to pass a measure.

[jake75]

This is one of my pet peeves - so I wasted some of my time to write to these Senators. I invites others to also do so. Fax costs me about 5 cents vs 46 cents postage.
It hurts me to address these Senators as "Honorable" but that is according to Hoyle.
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The Honorable Senator Chuck Grassley
135 Hart Senate Office Building
Washington, D.C. 20510
Fax: (202) 224-6020

The Honorable Senator Amy Klobuchar
302 Hart Senate Office Building
Washington, DC 20510
Fax: 202-228-2186

Dear Senators Grassley and Klobuchar:

I note that you are concerned about reports of oil companies pressing gas stations to continue selling premium
gasoline in addition to regular gasoline rather than adding E15, characterizing that as adversely affecting
competition in the marketplace, and have asked the Federal Trade Commission to investigate the matter.

For many years I have been opposed to the U.S law that mandates use of ethanol to the point that I cannot find
100% gasoline anymore. That definitely adversely affects my competitive choices in the marketplace.

Count me as one of a great many consumers who would prefer not to be forced to buy E10 let alone use E15
which most experts say can cause damage to automobile engines.

I think it is a deceptive and unfair practice in violation of Section 5 of the FTC Act to allow E10 to be sold as
gasoline. There is not even any requirement that the 10% ethanol content be disclosed. Perhaps the sugar lobby
could mandate the addition of 10% sugar to maple syrup and still call the end product maple syrup.

The EPA mileage numbers are based on 100% gasoline, a fuel that for all practical purposes you cannot buy in
the U.S. today. We are forced to buy the lower energy E10.

I wonder how much E85 is being sold to owners of cars with flex fuel engines. That would give you a clue as
to actual consumer demand for E15.

Not replacing Premium gas with E15 is the logical choice for gas stations. Some cars require premium gasoline.
the profit margin on premium gasoline is likely better than for E15.

I realize that my opinion means nothing, this special interest mandate is bought and paid for by the farm lobby
whose greed is legendary. Citizens generally are fed up with that system but don't seem to have any choices.

Respectfully,



Jerome R. Schindler

[Chiadog]

Great letter Jake! I may borrow it when I write to my SINators.

[Vulcan05]

From 1995 through 2009, the "honorable" Sen. Grassley has received $263,635 in USDA subsidies for corn, soybean and oats.
His son, Robin, has received $783,548.
His grandson, Patrick, who is an Iowa legislator (guess who's being groomed to replace grandpa?) has received $12,717.

Anti welfare, anti food stamp, anti Social Security, anti Medicare, anti Obamacare Chuck Chuck and his family have sucked over ONE MILLION DOLLARS from the Farmer Welfare program at the expense of YOUR tax dollars.

Any wonder he wants 15 percent alky in your gas?

[lannvouivre]

Oil companies say E15 hasn't taken off because consumers don't want it and because they say it poses a risk of damage to cars in some cases.

Many consumers don't want it, it's true, and the second part is true as well.