The Environmental Protection Agency proposed reducing the amount of ethanol that's required to be blended with gasoline Friday for the first time since a 2007 law setting aggressive targets for the corn-based fuel.
The move is a blow to farmers, ethanol producers, and high-tech companies investing in renewable fuel, including cellulostic biofuel. The move would would keep the current mixture, called E10, with up to 10 percent of ethanol rather than the more aggressive primarily-ethanol mix sold as E85.
The EPA plans to lower ethanol production targets in 2014, according to the filing.
Millions of "flex fuel" vehicles can handle blends of up to 85 percent ethanol, but few service-station customers are buying it. As a result, few stations sell the mixture.
In 2007, President Bush signed the Energy Independence and Security Act that set aggressive targets for increased production of biofuels. The law required the volume of biofuels produced in the U.S. to reach 36 billion gallons by 2022 from 4.7 billion gallons in 2007.