Assigned to NRRA                                                                                                      AS PASSED BY THE SENATE

 

 

 

 

ARIZONA STATE SENATE

Forty-seventh Legislature, Second Regular Session

 

AMENDED

FACT SHEET FOR H.B. 2590

 

ethanol E85; motor fuel

 

Purpose

 

            Creates guidelines and requirements for production and retail sale of ethanol blend E85.

 

Background

 

Ethanol is an alcohol-based alternative fuel produced by fermenting and distilling starch crops that have been converted into simple sugars. Ethanol is most commonly used to increase octane and improve the emissions quality of gasoline. The most common blends are E10 and E85. E85, a blend of 85 percent ethanol and 15 percent unleaded gasoline, is an alternative fuel for use in flexible fuel vehicles (FFVs). According to the U.S. Department of Energy, an FFV can run on either an ethanol blend or gasoline. Alternative fuel vehicles (AFVs), as defined by the Energy Policy Act of 1992, include any dedicated, flexible-fuel, or dual-fuel vehicle designed to operate on at least one alternative fuel.

 

            Biodiesel is a domestically produced, renewable fuel that can be manufactured from vegetable oils, animal fats or recycled restaurant greases. Blends of 20 percent biodiesel with 80 percent petroleum diesel (B20) can generally be used in unmodified diesel engines. Biodiesel can also be used in its pure form (B100), but it may require engine modifications to avoid maintenance and performance problems and may not be suitable for wintertime use.

 

Biodiesel produced and/or sold in Arizona is required by statute to meet the standards for California diesel fuel and the Environmental Protection Agency’s requirement for fuels and additives established in section 211 of the Clean Air Act. California’s diesel fuel standards are the highest in the nation. The California Air Resources Board (CARB) low-sulfur diesel fuel requirements mandate no more than 15 grams of sulfur per million grams of diesel fuel for production and retail sales.

 

Arizona Clean Burning Gasoline (CBG) was created in 1997 when the Federal Environmental Protection Agency (EPA) classified the Phoenix Metropolitan area (Area A) as “serious nonattainment” for both carbon monoxide and ozone. Arizona Department of Environmental Quality, in cooperation with Arizona Department of Weights and Measures, revised Arizona’s gasoline standards to implement the Arizona CBG program in Area A.
Arizona CBG consists of the same ingredients as gasoline; however, it is modified to reduce emissions of all pollutants. Use of Arizona CBG reduces hydrocarbon emissions by 29 tons per day, nitrogen oxides by 7 tons per day and carbon monoxide (during winter months) by 43 tons per day.

 

There is no anticipated impact to the state General Fund associated with this measure.

 

Provisions

 

1.      Requires a person who produces E85 or who is a retail seller of E85 to ensure that the fuel complies with American Society for Testing and Materials requirements and the equipment for dispensing E85 bear a notice stating that it is not gasoline and is only intended for use in flexible fuel vehicles and that the driver should review the owner’s manual for that vehicle before use.

 

2.      Requires producers of E85 to report to the Department of Weights and Measures no later than the 15th of every month all of the following information:

a)      the amount of the ethanol blend E85 produces in the previous month.

b)      the amount of ethanol used in the previous month.

c)      the amount of gasoline used in the previous month.

d)     the amount of the ethanol blend E85 sold in the previous month.

e)      the fuel quality parameters for the ethanol and gasoline that are the subject of the report.

 

3.      Requires an owner or operator of a motor fuel-dispensing site that dispenses E85 to ensure compatibility of the product and the dispenser and that the dispenser has received a national type certification of conformance.

 

4.      Requires a producer of E85 for sale in the CBG covered area to use CBG or Arizona Reformulated Blendstock for Oxygenated Blending as the gasoline portion of E85.

 

5.      Stipulates that a retail seller of E85 in compliance with all of the requirements of statute cannot be held liable if a consumer misfuels and puts E85 in a nonflexible fuel vehicle.

 

6.      Removes the requirement for a gasoline blend other than a gasoline ethanol blend in Area A to contain no less than 2.7 percent of oxygen nor more than EPA standards allow.

 

7.      Allows gasoline ethanol blends in Area A to contain no less than 2.7 weight per cent of oxygen.

 

8.      Modifies the definition of “motor fuel” to include biodiesel blends and E85.

 

9.      Exempts E85 from the definition of “gasoline.”

 

10.  Makes conforming and technical changes.

 

11.  Becomes effective on the general effective date.

 

Amendments Adopted by Committee

 

1.      Allows state, municipality or school district fleet managers to earn credits toward the state mandate of alternative fuel vehicle purchases by purchasing biodiesel, diesel substitute or an ethanol or methanol blend.

 

2.      Stipulates that the fuel credit be calculated as one vehicle credit for every:

a)      450 gallons of neat biodiesel.

b)      2,250 gallons of diesel substitute.

c)      530 gallons of E85.

 

Amendments Adopted by Committee of the Whole

 

·         Withdrew NRRA amendment.

 

House Action                                                              Senate Action

 

ENV                2/1/06     DPA     5-0-0-4                    NRRA             3/8/06     DPA     6-0-1-0

3rd Read           2/21/06                52-0-8-0                  3rd Read           4/4/06                  24-5-1-0

 

Prepared by Senate Research

April 4, 2006

FB/DA/jas