SIGMA: California Regulations Create E15 Adoption Hurdles

NASHVILLE, TN(DTN) – California continues to face unique challenges that slow adoption of E15, even as the state leads the nation in renewable fuel sales, panelists said at the SIGMA 2025 Annual Conference. While Texas has emerged as the largest gasoline market in the U.S., surpassing California since the COVID-19 pandemic, California’s strict regulations make expanding E15 availability more complicated.

Unlike 49 states that have eliminated Stage 2 vapor recovery requirements, California maintains enhanced rules for vapor recovery systems. “The lack of UL-listed Phase 2 vapor recovery equipment for E15 creates a technical barrier for stations,” said Jeff Dzierzanowski, Manager of New Business Development at Source North America Corporation. “Stations have to navigate additional costs and approvals, which slows adoption compared to other states.”

Despite these hurdles, California remains a leader in renewable fuel through E85 sales. The state sold 116 million gallons of E85 last year, topping the nation, and continues to benefit from the largest share of Low Carbon Fuel Standard tax credits. Andrew Falco, Director of Market Development at Growth Energy, noted that “California’s success with E85 shows the market’s willingness to embrace higher ethanol blends when infrastructure and incentives align.”

Lance Klatt, Executive Director of the Minnesota Service Station & Convenience Store Association, emphasized the need for continued collaboration. “Industry groups, policymakers, and station owners need to work together to overcome regulatory hurdles while educating consumers on ethanol benefits,” Klatt said. Moderator Kristy Moore of KMoore Consulting guided the discussion, highlighting the role of coordinated efforts in addressing both technical and regulatory challenges.

Panelists agreed that overcoming California’s unique regulatory landscape could serve as a model for other states, supporting growth in E15 and higher ethanol blends nationwide while advancing renewable fuel goals.