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Minnesota Agriculture Commissioner Gene Hugoson discusses the state of the Minnesota ethanol industry on Wednesday. With him are Farmers Union President Doug Peterson, left, and south-central Minnesota farmer Gary Pestorious. Photo by Don Davis, St. Paul Capitol Bureau.

Ethanol levels could be on rise

By Don Davis

St. Paul Capitol Bureau

ST. PAUL - Federal officials have until year's end to decide whether gasoline may contain more than the common 10 percent ethanol.

If that happens, ethanol supporters promise thousands of new jobs for the Minnesota economy and another step toward national energy independence.

"We are not going to kneel at the altar of big oil in this country forever," said Doug Peterson, a former state lawmaker and current Minnesota Farmers union president.

A coalition of ethanol producers, Growth Energy, earlier this month submitted to the U.S. Environmental Protection Agency a request that gasoline be allowed to contain up to 15 percent ethanol. Current federal law limits ethanol in most gasoline to 10 percent, although specially made cars can use fuel with 85 percent ethanol.

The request is not to mandate the sale of what is known as E15, only to allow it to be used in normal cars.

The EPA has until the end of the year to decide on the request.

Minnesota Agriculture Commissioner Gene Hugoson said that all studies he has seen - including from North Dakota State University and Minnesota State University Mankato - show cars can use E15 without any problems. Small engines also should be able to use it without difficulty, he added.

Opponents argue that higher percentages of ethanol damage engines and cause them to run less efficiently. Hugoson said those are the same arguments heard in the1990s when Minnesota became the first state to require that nearly all gasoline contain 10 percent ethanol.

If E15 were allowed, Growth Energy predicts that 136,101 jobs - mostly for people constructing new ethanol plants - would be created in Minnesota. The industry would provide a $24.4 billion boost to the economy, Growth Energy reported.

Midwest officials have launched a lobbying effort to convince the Obama administration to back the higher ethanol level.

"Such a step toward higher blends will help us move more quickly towards reducing our dependence on foreign oil and will provide more American jobs and investment," Minnesota Gov. Tim Pawlenty wrote to new Agriculture Secretary Tom Vilsack.

Pawlenty told Vilsack, a former Iowa governor, that Minnesota law requires the state to require 20 percent ethanol in gasoline in coming years - but only if the EPA grants its approval.

North Dakota Gov. John Hoeven, chairman of the Governors' Biofuels Coalition, recently told President Barack Obama that biofuels such as ethanol and biodiesel need promotion.

"It is very important that we have a sustained effort over time to build up biofuels if we truly want a viable, domestic supply of transportation fuel," Hoeven said.

Hoeven said he expects the Obama administration to approve a higher ethanol blend within months.

U.S. Rep. Collin Peterson, D-Minn., House Agriculture committee chairman, said he expects a 13 percent blend to receive approval.

If federal officials approve any blend less than 20 percent, the Minnesota Legislature may need to pass new law lowering the goal from the current 20 percent requirement.

Rep. Al Juhnke, DFL-Willmar, said he sees no problem getting broad support to change the law to match the federal decision. He is House agriculture finance chairman.