The People of America's Oil and Natural Gas Indusry

Putting the Brakes on Chicago’s E15 Mandate

Mark Green

Mark Green
Posted December 16, 2014

Chicago Mayor Rahm Emanuel and his allies on the city council deserve credit for putting a stop – for now at least – to an ill-conceived proposal that would mandate the sale of higher ethanol blend E15 fuel at city service stations.

We say ill-conceived because, as argued here and here earlier this year, the E15 requirement could be full of risk for consumers and small business owners – while mainly benefiting ethanol producers. Recently, AAA urged Chicago lawmakers to vote against the ordinance. Let’s think this through more carefully, the mayor said, and the proposal was shelved. Later, the Chicago Tribune editorialized:

The touted cost savings and environmental benefits are dubious. E15 produces less energy than regular gasoline, so vehicles would get fewer miles to the gallon on it. And the production of ethanol uses a great deal of energy. So why is the ethanol industry pushing this? Because it has a massive supply of ethanol and not enough demand for it. There is no natural market demand for this. Without a government mandate for more ethanol, more ethanol won't get sold. … Aldermen, really. Why would you want to prop up an industry by creating a risk for your constituents? Stop this ordinance once and for all.

The reasons for this view are pretty straight-forward – which we’ve underscored recently with a dash of humor:

Potential vehicle damage – Research has shown E15 could damage engines and fuel systems in millions of vehicles on the road today. Automakers have warned that using E15 in vehicles that weren’t designed to use it could void warranties.

car

The real-world impacts of pushing more E15 into the fuel supply could fall on consumers and the broader economy, according to a NERA Economic Consulting study. If Chicago imposes the E15 proposal, it could impact small businesses that own a number of the city’s service stations. One owner, Russell Garcia, made the point in a letter to the editor of the Tribune in October:

The idea of mandating the sale of E15 gasoline in Chicago is poor public policy. … (M)y businesses would be negatively impacted by this mandate, and my customers would be harmed too. E15 provides no cost savings. While E15 has a sticker price that is about the same as traditional gasoline, its poorer gas mileage makes it more expensive. Plus, the cost of retrofitting new underground tanks at my stations and my competitors' would necessitate even higher gas prices.

Refueler, beware – E15 also poses potential risks in a number of other areas.  For example, if you own a gasoline-powered leaf blower

leaves

Or a snowblower

snowthrower

Or maybe a snowmobile

snowmobile

The point being that E15 could foul up engines in all kinds of outdoor equipment. As the Tribune editorial noted:  

The biggest risk comes if equipment is stored for the season with fuel still in the tank. Ethanol tends to make rubber and plastic parts more brittle. Ethanol attracts water, which can increase corrosion in moving parts. A long winter in contact with this mix can compromise the equipment.Higher concentrations of ethanol in fuel can make small engines run hotter, which in turn can cause malfunctions. Many manufacturers of outdoor power equipment will not honor warranties if owners use E15 fuel. They strongly oppose diluting gasoline with more ethanol.

E15 also poses potential risks for marine engines and motorcycles.

So, again, Mayor Emanuel and a number of city council members are right to want to know more about E15 before potentially imposing what could be a costly mandate on consumers and the city’s service stations. The Tribune also is right: Chicago officials should kill this proposal once and for all.

ABOUT THE AUTHOR

Mark Green joined API after a career in newspaper journalism, including 16 years as national editorial writer for The Oklahoman in the paper’s Washington bureau. Mark also was a reporter, copy editor and sports editor. He earned his journalism degree from the University of Oklahoma and master’s in journalism and public affairs from American University. He and his wife Pamela live in Occoquan, Va., where they enjoy their four grandchildren.