Renewable Fuels Association Calls on Gov't to Investigate Discrimination

WASHINGTON, D.C. -- The Renewable Fuels Association (RFA) sent a letter this week to the Environmental Protection Agency (EPA), Federal Trade Commission (FTC), Department of Energy (DOE) and the Department of Agriculture (USDA) requesting a multi-agency investigation into "the oil industry's highly discriminatory conduct."

The letter primarily focuses on Lawrence, Kan.-based Zarco 66, the first U.S. convenience store retailer to offer E15 at the pump last year. Shortly after the retailer began offering the fuel, which is a blend of 15 percent ethanol and 85 percent gasoline, the ConocoPhillips Inc. franchisee allegedly faced backlash.

"ConocoPhillips quickly threatened to terminate Zarco 66's franchise agreement and charge Zarco 66 hundreds of thousands of dollars in penalties unless Zarco 66 started offering 'premium' gasoline -- gasoline that would replace the ethanol housed in one of Zarco 66's fueling tanks, and a gasoline that is likely to result in far fewer sales that the ethanol blends that would be available if Zarco 66 maintained the current ethanol contents," the letter stated.

The letter, signed by RFA President and CEO Bob Dinneen and addressed to Robert Perciasepe, acting administrator of the EPA; Jon Leibowitz, chairman of the FTC; Steven Chu, secretary of the DOE; and Tom Vilsack, Secretary of the USDA, added that big oil companies are violating Section 1 of the Sherman Antitrust Act and are sending a clear message to retailers to "stop selling renewable fuels or face the consequences."

Dinneen concluded by asking the four government agencies to investigate conduct that is "impeding" the delivery of renewable fuels to the American marketplace. "Otherwise, Zarco 66 will simply represent the first casualty in the oil industry's war against the marketing and delivery of cheaper, more sustainable renewable fuels," he wrote.

Zarco 66 operates eight c-stores, all of which sell E15.

Neither ConocoPhillips nor any of the four government agencies have yet to issue a response to the allegations put forth in the letter penned by the RFA.