July 1, 2008

Ethanol Blends May Increase Auto Emissions; Other Industries May Pay a Price for De Facto Federal Fuel Mandate


While state legislators attack reformulated gas in southeastern Wisconsin for its cost and waning effectiveness, something else is brewing in gas pumps in the rest of the state that has the potential, if not a promise, to stir statewide controversy.

It's all centered on ethanol.

The Wisconsin Department of Natural Resources warned three years ago that blending 10% ethanol into the state's regular-grade fuel supply -- without making other changes to the gas -- would pollute the air as much as a 350-megawatt coal-fired power plant.

The warning came in response to a bill in the state Legislature in 2005 mandating that all regular-grade gas be blended with ethanol. Backers said the bill would boost corn farmers and the ethanol industry, and decrease dependence on foreign oil.

Opponents cautioned that higher corn prices could have crippling ripple effects and force other industries to take stiffer and costly pollution control measures.

The bill stalled. But that wasn't the end of ethanol-blended gas.

Fast forward to June 2008. About 85% of all regular-grade gasoline in Wisconsin is now blended with 10% ethanol.

The federal Energy Independence and Security Act, signed by President Bush in December 2007, contains a renewable fuels standard that requires the use of 36 billion gallons of renewable fuels by 2022.

The standard essentially created a de facto federal mandate for E- 10, or a 10% ethanol blend, industry experts say.

Most of the major oil companies have switched or are in the processing of switching their entire stocks to E-10, said Erin Roth, executive director of the Wisconsin Petroleum Council, which represents oil refiners and suppliers.

"We don't have any choice," Roth told Public Investigator. "We have to meet those goals."

The fuel is not reformulated and causes an increase in emissions of nitrogen oxides and volatile organic compounds, both major players in the formation of ground-level ozone.

The EPA is studying the impact of the widespread addition of ethanol. But if the earlier projections hold true, the agency is sure to find problems, experts say.

"We'll have to compensate for that," said Larry Bruss, chief of regional pollutants and mobile sources at the DNR. "It will have to be offset."

Ethanol has long been used in the reformulated gas in southeastern Wisconsin but doesn't present the same pollution problems, in part because the gas is tweaked to lower the evaporation point.

But simply mixing ethanol into conventional gas leads to more smog-causing emissions.

The DNR is in the midst of creating a plan to submit to the EPA outlining how the state will meet ozone standards, but Bruss said the details haven't been worked out yet. A public hearing will be held next year before the plan has to be submitted in September.

"I'm not sure exactly what we're going to do," Bruss said.

Scott Manley, environmental policy director for Wisconsin Manufacturers & Commerce, said E-10 is "certainly a concern." The DNR often turns to industry to reduce and offset increases in air pollution.

"When you dump a fuel on the Midwest that is known to increase ozone pollution, what are manufacturers supposed to do?" Manley said. "We would hope that the EPA would take into account that the federal fuel policy is potentially affecting air quality in Wisconsin and we should be given consideration."

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