President Obama's U.S. Environmental Protection Agency reduced the federal required levels of ethanol that must be blended with gasoline, which dealt a blow to a biofuel that's falling out of favor in an era of cheap gasoline.
The announcement is the first look at Obama's proposed volume requirements under the Renewable Fuel Standard (RFS) for 2015 and 2016, as well as biomass-based diesel for 2017.
While the Obama administration reduced ethanol requirements in the proposal, the EPA raised future biofuel totals.
In a related announcement, Agriculture Secretary Tom Vilsack announced on May 29 that the U.S. Department of Agriculture is investing up to $100 million in a Biofuels Infrastructure Partnership to "support the infrastructure needed to make more renewable fuel options available to American consumers," according to a release.
The partnership will offer grants to match state-led funding efforts to test and evaluate ways to market higher blends of renewable fuel, such as E-15 and E-85.
Members of the U.S. Senate and House have introduced separate bills seeking to end the federal ethanol blending mandate, and two states (Florida and Hawaii) no longer require ethanol blending in fuel sold in those states.