Fuel Retailers Not Ready to Embrace E15

Many fear liability concerns for engine damage if they offer the higher-ethanol blend.

February 29, 2012

ORLANDO, Fla. - While the nation??s ethanol industry applauds the U.S. Environmental Protection Agency??s (EPA) decision to begin E15 registration, gasoline retailers are indicating that they are not as supportive of offering the higher-ethanol blend, Platts reports.

The Petroleum Marketers Association of America (PMAA) predicts that within a decade, only 20% of fuel retailers will stock E15, and those will likely be located in prairie states like Iowa. Many gasoline station owners are concerned about liability for engine damage because the fuel is not approved for vehicles older than 2001 and small-engine equipment, such as lawnmowers.

"A retailer has to decide is the juice worth the squeeze?" said Dan Gilligan, the association??s president. "Am I going to increase volume sales enough by dealing with all this confusion with my customers?"

Most retailers only have two underground storage tanks, one for regular and one for premium, and many don??t have the room to add a third tank. Gilligan forecasted that a big player, such as a Valero, adding E15 pumps would boost industry-wide acceptance of the fuel.

"But I can't envision that anytime soon," said Gilligan. "So you've got to think the folks in the ethanol industry are thinking very long-term about this ?" jumping all these hurdles so that, maybe 10 years from now, a decent presence of E15 might exist in the marketplace. They probably quibble with my statement."

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