The Environmental Protection Agency Wednesday raised the amount of renewable fuels that must be blended into the nation's gasoline supply.
The levels will be raised from 18.11 billion gallons of renewable fuel per year to 19.28 billion gallons, most of which will be met through the blending of corn-based ethanol.
The oil industry protested the rule immediately, saying the increased amount of ethanol in gasoline will harm vehicle engines.
The new Renewable Fuel Standard rule goes into effect in 2017. The EPA is required by law to issue a rule each year to tell refiners how much renewable fuel they are required to blend in the nation's fuel supply.
"We are disappointed that EPA has taken a step backwards with this final rule," said Frank Macchiarola, the American Petroleum Institute's director of downstream operations. "The RFS mandate is a bad deal for the American consumer," he said.
"Today's announcement only serves to reinforce the need for Congress to repeal or significantly reform the RFS," Macchiarola added. "Democrats and Republicans agree this program is a failure."
The ethanol industry downplayed the need for any such reform, saying it "helps put consumers in the driver's seat when it comes to fuel choice at the pump."
"We can all be thankful EPA has raised the conventional biofuel requirement to the 15 billion gallon level required by the statute," said Bob Dinneen, president and CEO of the Renewable Fuels Association.
"The move will send a positive signal to investors, rippling throughout our economy and environment," he added. "By signaling its commitment to a growing biofuels market, the agency will stimulate new interest in cellulosic ethanol and other advanced biofuels, drive investment in infrastructure to accommodate ... higher ethanol blends and make a further dent in reducing greenhouse gas emissions."