U.S. to allow more ethanol in gasoline for newer cars

WASHINGTON Wed Oct 13, 2010 2:58pm EDT

A worker pumps gasoline blended with 10% ethanol at the UPI Energy gas station in Chatham, Ontario, Canada, April 11, 2008. REUTERS/Mark Blinch

A worker pumps gasoline blended with 10% ethanol at the UPI Energy gas station in Chatham, Ontario, Canada, April 11, 2008.

Credit: Reuters/Mark Blinch

WASHINGTON (Reuters) - The U.S. Environmental Protection Agency on Wednesday will clear the way for gasoline that is blended with up to 50 percent more ethanol to be used in vehicles made since the 2007 model year, giving a boost to farmers who grow the corn that is used to make most U.S. ethanol, an ethanol industry source told Reuters.

The EPA will approve a request from the Growth Energy coalition of ethanol producers to boost the amount of ethanol in a gallon of gasoline to up to 15 percent from the current 10 percent, the source said.

EPA is expected to decide in December on whether the fuel, known as E15, can used in cars built from 2001 to 2006.

EPA's approval of higher blends will also help ethanol producers, who say they need to draw down a glut of supply.

Federal law requires energy companies to blend 15 billion gallons of corn-based fuel a year into the gasoline supply by 2015, up from 12 billion gallons this year.

Ethanol helps stretch U.S. gasoline supplies, which is supposed to make America less dependent on foreign petroleum suppliers.

However, E15 gasoline probably would not be available until early next year, assuming the EPA also approves later this year the higher blends for older vehicles.

Many service stations have expressed a reluctance in selling E15, because of most of the fuel pumps have not been certified to sell the higher ethanol blend. Service station owners also face being sued by consumers if E15 harms the engines of boats, lawn movers and chain saws.

To help clear up any confusion with drivers, the EPA on Wednesday will also propose a rule on placing E15 labels on gasoline pumps.