February 11, 2009

Gasoline producers in the US should be allowed to blend more ethanol into the fuel mix than the current 10 percent limit, US Department of Agriculture Secretary Tom Vilsack said Tuesday (February 10), although he didn't specify how high the cap should be.

An increase in the percentage that can go into gasoline would be a way to stimulate the corn-based ethanol industry, Vilsack told reporters after a speech to farmers, and that is why he said he is advocating a shift and talking about options together with US Environmental Protection Agency Administrator Lisa Jackson.

"Obviously we're encouraging [Jackson] to consider an adjustment to the blend ratio," Vilsack said.

While Vilsack didn't say how high he would like to see the blend cap, he stressed there should be an increase.

"My hope is that we can get a blend rate that is higher than 10 percent," Vilsack said. "That is going to create more opportunities for the ethanol industry. We're encouraging EPA to do that. We hope that they'll listen to our concerns."

The US ethanol industry has suffered in recent months with bankruptcies and production halt by companies that lost money because of fluctuating corn and gasoline prices in 2008.

The EPA will play a key role in the process of deciding whether or not more ethanol can be added to the gasoline on which most cars in the US run, but the agency depends heavily on data provided to it by car manufacturers and the Department of Energy, EPA spokeswoman Cathy Milbourn said.