WASHINGTON, June 24 (Reuters) - The U.S. Supreme Court on Monday rejected a challenge by oil and food industry groups to sales of a higher blend of ethanol allowed by the Environmental Protection Agency.
The U.S. ethanol industry, which mostly makes fuel from corn, has pushed for E15, which contains 15 percent ethanol versus the traditional blend containing 10 percent.
It celebrated when the EPA in 2011 expanded use of E15 to cars built since the 2001 model year, which now comprise about two-thirds of the cars on the road in the United States.
But the EPA’s move angered the American Petroleum Institute, the Grocery Manufacturers Association and other industry groups. They filed a petition this year to the Supreme Court to overturn a lower court’s decision upholding sales of the higher blend.
Ethanol can cut into the profits of gasoline producers, while food groups complain that ethanol use can raise grain and meat prices. They blame ethanol for helping to push corn prices to record levels during last year’s drought, the worst in more than 50 years.
During the drought, ethanol opponents petitioned the EPA to temporarily waive the ethanol mandate. The food and refinery groups also petitioned the U.S. Court of Appeals for the D.C. Circuit to overturn its earlier decision allowing E15. They lost on both counts and petitioned the Supreme Court over the lower court’s decision.
Monday’s decision disappointed the oil refining industry which has also complained E15 can damage engines in boats, outdoor equipment, and older cars.
“The Supreme Court’s decision denies the petitioners their day in court and will have negative repercussions for consumers,” said Charles Drevna, the president of the American Fuel and Petrochemical Manufacturers industry group.
Ethanol groups applauded the rejection of the challenge. The decision clears the way for more fuel options for U.S. drivers, said Jeff Lautt, the CEO of POET, one of the world’s largest ethanol producers. “We think drivers deserve reliable choices at the pump,” he said. (Reporting by Timothy Gardner, editing by Ros Krasny, Bernard Orr)