California Clears Path for Widespread E15 Adoption

California lawmakers have taken a major step towards making E15, a gasoline blend containing 15% ethanol, widely available in the state. Senate Bill 795 has been approved and now heads to Governor Gavin Newsom for signing. The bill directs state regulators to remove remaining barriers to E15 adoption after California legalized it last year.

California consumes approximately 13 billion gallons of gasoline annually. If the entire market were to shift from E10 to E15, the additional ethanol demand could reach around 650 million gallons, equivalent to about 240 million bushels of corn. While corn would capture most of this demand, sorghum growers may also benefit.

The California low-carbon fuel program recognizes both corn- and sorghum-based ethanol pathways, providing Plains growers with a potential secondary market for their crops. However, the adoption rate of E15 by retailers and the impact of falling gasoline demand on total volumes will be crucial in determining the actual effects of this shift.