AFPM President Charlie Drevna responds (RFS props big ethanol, hinders small businesses) to Sens. Grassley and Klobuchar’s charge of anti-competitive practices in The Hill on July 25th:
There’s no way around it: the Renewable Fuel Standard (RFS) — the policy touted in The Hill by Sens. Grassley and Klobucharl as a cure-all for the nation’s energy woes — is actually a burden to consumers, their vehicles and the businesses trying to sell fuels the market demands.
The senators’ misguided claims about the oil industry’s “anticompetitive practices” are unfortunately not surprising given the common misperception that big oil companies own most U.S. gas stations. In reality, convenience stores operate more than 80 percent of the estimated 153,000 fueling stations across the country and sell roughly 80 percent of all the fuel purchased in the country. Of these stations, nearly 60 percent are locally owned small businesses. To stay afloat, these business owners must remain responsive to their consumers’ demands. While franchised retailers are typically contracted to offer several fuels produced by their refining partner, they retain every right to sell additional fuels that they see fit for their local marketplace. Despite this liberty, many choose not to sell higher ethanol blends like E15 and E85 (gasoline containing 15 and 85 percent ethanol, respectively) due to low consumer demand, engine damage concerns and compatibility issues.
It’s no wonder demand lags when the Environmental Protection Agency (EPA) has deemed E15 incompatible with cars manufactured before 2001, heavy duty vehicles, boats, motorcycles and small engine equipment. Meanwhile, more than 90 percent of the 253 million vehicles on the road today are not approved by automakers to use E15, including most 2001-2013 models. In fact, automakers like Chrysler, Ford, General Motors, Honda, Mazda, Toyota, Nissan and Hyundai’s warranties do not cover E15-related claims in most of their post-2001 models. Drivers are thus accountable for repairing any potential damage caused by E15, which can include corrosion, rust, clogging and deterioration of fuel system components.
Read Charlie Drevna’s entire editorial here.