California legislature clears E15 bill unanimously as US ethanol blend rate tops 11%
California's legislature passed a bill to allow E15 sales, and it cleared unanimously. California is the last big fuel market that still blocks the 15% blend, so if the governor signs it, jobbers and retailers gain a market that has been closed to E15 for years. The Renewable Fuels Association, which has pushed this for years, is already turning to the California Fuels and Convenience Alliance annual conference to work the rollout with the operators who would sell it.
The E15 vote
The bill passed unanimously out of the state legislature. A unanimous vote is hard to get in California, where fuel rules move slowly and rarely favor a higher ethanol blend. RFA President and CEO Geoff Cooper called it the breakthrough the group has chased. For a retailer, the near-term question is equipment and label approval, not politics, though the vote clears the biggest barrier standing in front of both.
Blend rate past 11%
The national ethanol blend rate moved past 11%, above the 10% that E10 alone delivers. The share above 10% comes from E15 selling at enough stations, and California coming online could push it higher.
Production and exports
US fuel ethanol production fell 1% in the week ending Sept. 4, per EIA data released Sept. 10. Stocks rose nearly 15% in the same stretch, and exports grew by more than 41%. Production easing while stocks build points to plants running ahead of domestic demand, with the export market taking the difference. USDA's Foreign Agricultural Service put July exports at 199.5 million gallons of ethanol and 1.1 million metric tons of distiller grains, so the overseas pull is real and carrying volume.
Capacity
US ethanol production capacity rose to 18.375 billion gallons in June, per BioEnergy Times. More capacity alongside softer weekly output and building stocks says the plants have room and are leaning on exports to move product rather than a tight home market.
What to watch
Whether California's governor signs the E15 bill, and how fast label and equipment rules follow if he does. Watch whether the export pace holds, because stocks up nearly 15% with production easing only works if foreign buyers keep taking the volume. The California Fuels and Convenience Alliance conference is the other thing to follow, since that is where RFA is taking the rollout to the operators who would actually pump E15.