FACT:
97%
from a handful of refiners to hundreds or thousands
of small fuel retailers would undermine the viability
of this successful program.
AE: Will changing the current
system limit my ability to save
money at the pump?
Bliley: Most likely. Under the current system,
retailers offer biofuel blends, such as E15, at a
discount (often 3 to 10 cents per gallon), even
when ethanol costs nearly as much as gasoline.
These discounts help fuel retailers to price fuel as
low as possible to attract customers and sell more
convenience items like drinks and candy. A shift in
the point of obligation would shake this system to its
foundation since refiners do not have this incentive
to pass along the savings.
AE: Would a shift in the point of obliga-
tion limit my choices at the pump?
Bliley: If your retailer offers ethanol blends like E15,
everything could change. Shifting the point of obli-
gation would undercut the retailers who are doing
the most to offer you more choices at the pump.
The number of stations selling E15 (currently 700
stations in 29 states) would drop significantly.
AE: Why would changing the point of
obligation be so detrimental to renew-
able fuels?
Bliley: The RFS has been the law since 2005. The
entire fuel and blending system has been built
based on the certainty of the RFS. Changing the
point of obligation would immediately throw the pro-
gram into turmoil. Federal government regulators
would have to begin a long, complicated rulemaking
process that would, at a minimum, take 18 months
but would not likely be resolved for several years.
“Changing the point of obligation will impose dra-
matically higher costs on consumers or even result
in the withdrawal of options from the marketplace.”
AE: What would a
shift in the point of
obligation mean for the
future of biofuels?
of our gasoline supply
now contains
ethanol.
Bliley: It will halt the expansion of E15 and
decrease ethanol sales overall. All the major fuel
retailers and convenience store chains, from Sheetz
to Minnoco to Kum & Go, oppose a shift in the point
of obligation.
AE: Are convenience stores the only ones
affected by these potential changes?
Bliley: No. A shift in the point of obligation would
also impact marketers, truck stops, trucking compa-
nies, railroads, and even consumer service com-
panies like FedEx and UPS, which would suddenly
have to deal with significant compliance costs.
AE: Are there any alternatives?
Bliley: Some have suggested that a change to the
point of obligation would be an acceptable sacrifice
if the U.S. Environmental Protection Agency (EPA)
would lift obscure, outdated regulatory barriers limit-
ing sales of E15 in the summer. This would involve a
Reid Vapor Pressure (RVP) waiver. However, an RVP
waiver is essentially meaningless if the point of obli-
gation is changed because retailers would no longer
have any incentive to sell higher ethanol blends.
AE: What can I do?
Bliley: Contact your federal lawmakers and tell them
you want choices when it comes to renewable fuels.
Also, let them know you don’t want the market un-
certainty that would arise from a shift in the point of
obligation. For the latest updates on this key issue,
visit growthenergy.com.
“Any change in the point of obligation would be
detrimental to the biofuel industry and result in
higher retail fuel prices.”
Lance Klatt
executive director
SPRING 2017
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