The Real Facts on AAA and Ethanol

Michael Green(WASHINGTON, December 16, 2013)

Some outside organizations have inaccurately portrayed AAA as being against ethanol or the Renewable Fuels Standard. This is not true. AAA has long supported the use of alternative fuels including ethanol. We believe that ethanol-blended fuels have the potential to support jobs, promote American energy independence and reduce fuel costs. More than 95 percent of the gasoline sold in the United States is E10, while E85 is designed for use by flex-fuel vehicles.

Despite ethanol’s benefits, AAA is concerned with the way the industry has introduced and marketed E15 to consumers. Most drivers are unaware of the potentially negative effects of E15 and have not been properly educated about this new fuel.

More than 90 percent of the vehicles on the road today are not approved by manufacturers to use E15, including nearly all 2001-2013 models. E15 is only approved for use by automakers in flex-fuel engines, 2001 and newer Porsches, and selected 2012 and newer vehicles where it is clearly specified in the owner’s manual. Sustained use of E15 gasoline in vehicles not designed for its use could result in significant problems such as accelerated engine wear and failure, fuel-system damage and false check engine lights. Automakers are on record as saying their warranties will not cover claims caused by E15.

While new cars increasingly can use E15 gasoline, previous makes and models were never designed to use the fuel. It will still take at least another decade before the bulk of the fleet will be E15 compatible given that the average vehicle remains in use for more than 11 years.

Ethanol producers have proposed expanding sales of E15 gasoline to help meet a federal requirement called the Renewable Fuels Standard (RFS).  The RFS requires renewable fuels such as ethanol to be blended into gasoline in increasing amounts each year. When Congress passed the law, experts predicted that U.S. gasoline consumption would continue to rise, which would support correspondingly higher ethanol use.  This has proven incorrect as gasoline consumption has remained relatively flat due to more fuel efficient vehicles, a weaker economy and changes in driving habits.

The volume of ethanol originally required by law in the Renewable Fuels Standard next year is likely to exceed 10 percent of the fuel supply. Exceeding this level is known as the “blend wall,” given that most gasoline contains 10 percent ethanol. The EPA does not believe it is possible to meet the RFS next year given market and infrastructure limitations with both E15 and E85, and has proposed reducing requirements to avoid the blend wall.

Blenders unable to meet RFS requirements would be subject to significant fines, which could incentivize gasoline exports or burden producers with unsustainable costs. These consequences could restrict gasoline supplies and result in significant increases in gas prices paid by consumers.

It is for these reasons we have called for a reduction in requirements to the Renewable Fuels Standard for next year and support the EPA’s efforts to reduce targets to protect consumers. While ethanol has the potential to support the economy and reduce the reliance on fossil fuels, it is irresponsible to mandate more ethanol than cars can safely use.

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