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EPA May Slash Use of Ethanol in Gasoline

Drought creating potential shortages of corn stock.

by on Oct.12, 2012

The EPA may shift corn away from ethanol use to reduce demand on drought-impacted farms.

Only months ago, the EPA was pressing hard to expand the use of ethanol in the nation’s gasoline supply, but in the wake of this summer’s fierce drought, the agency may soon reverse course and actually trim back because of shortages of corn used to produce the renewable fuel.

Senator Orrin Hatch, an influential Utah Republic this week urged the EPA to curb ethanol requirements, as have 200 members of the House and the governors of eight corn-producing states. Under a 2007 law signed by former President George Bush, 15.2 billion gallons of ethanol would need to be used this year, with the plan to more than double that by 2022.

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But the viability of that plan came under sharp inspection when, yesterday, the U.S. Department of Agriculture forecast a sharp decline in farm grain output predicting next year’s global corn stockpiles will 5.4% – to the lowest levels in 39 years.  The USDA warned that only 23% of American corn crop yields are in “good” or “excellent” shape compared with 70% last year.