Ethanol advocates are continuing to throw down the gauntlet with Big Oil. Jabs have been thrown through satire and blogging – now the Renewable Fuels Association (RFA) is throwing a hook by going after ConocoPhillips, one of Big Oil's top five conglomerates.

After offering E15, "ConocoPhillips quickly threatened to terminate Zarco 66's franchise agreement unless Zarco 66 started offering 'premium' gasoline."

RFA says that ConocoPhillips has threatened the franchise agreement with fuel station retailer Zarco 66 unless it offers premium gasoline. This gasoline would have to replace the ethanol stored in one of Zarco 66's two fueling tanks; these tanks have stored ethanol that's been used for years in the blend of 85-percent ethanol (E85) at Zarco 66 fuel stations. ConocoPhillips put the pressure on to sell premium gasoline not long after Zarco 66 became the nation's first retail chain to offer gasoline with 15 percent ethanol (E15) last summer. "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," said RFA president and CEO Bob Dinneen. If ConocoPhillips gets its way, it would mean "far fewer [ethanol] sales than the ethanol blends that would be available if Zarco 66 maintained the current ethanol contents," Dineen said.

"I am a true believer in energy independence, alternatives [and] domestic fuels, and I will continue to fight for that."

RFA is also asking for a federal investigation into the matter. The ethanol advocacy association sent a three-page letter to the US Environmental Protection Agency, Federal Trade Commission, US Department of Energy and US Department of Agriculture. RFA is requesting the agencies to investigate and put an end to the "oil industry's highly discriminatory and unlawful conduct – conduct that is impeding the delivery of renewable fuels to the American marketplace," the letter stated. Zarco 66 could become the "first casualty" in the oil industry's war against renewable fuels.

Zarco 66 has yet to cave in to Big Oil. "I am a true believer in energy independence, alternatives [and] domestic fuels, and I will continue to fight for that, because I believe that is what is in the best interest of our country," Zarco 66 owner Scott Zaremba told Ethanol Producer Magazine.


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  • 45 Comments
      • 1 Year Ago
      Say goodbye to ethanol come 2016 when the Republicans take back the WH yeeha! The US has more than enough oil for hundreds of years. After that time, all humans would be cyborgs anyway.
        • 1 Year Ago
        That makes a lot of sense... You do realize a Republican WH put ethanol in place in 2005, then upped the volume requirements in 2007?
      EVSUPERHERO
      • 1 Year Ago
      Why would Conoco do such a thing? Marco? They don't need the money, they have all of China and many third world countries to addict, so why mess with this guy? Of all the oil joints in all the world, why? Oh yea, that's right, they do it, because they can. Oh yes, and Dan, Dan, what a well though out comment, good un, zeb.
      Good All
      • 1 Year Ago
      Ethanol is a domestic fuel and with more and more cellulose ethanol coming to market, we could get a cheaper fuel finally. Oil companies could not compete with Ethanol and so they are threatening. Eventually Ethanol will gain 15 % market share.
        VL00
        • 1 Year Ago
        @Good All
        It takes oil to produce Ethanol, currently the net energy is 0 at best, and negative at worst.
      Letstakeawalk
      • 1 Year Ago
      Stick to your guns, Scott Zaremba. Don't let profits and greed stop you from doing what you think is right. If ConocoPhilips wants to terminate your franchise agreement, offer to tear it up in front of them!
        Marcopolo
        • 1 Year Ago
        @Letstakeawalk
        @ Letstakeawalk It's not that simple. There are always two sides in any dispute. Jon LeSage's rehash of the "Ethanol Producer" article failed to mention that Scott Zarema is also motived by profit. [Quote] gasoline that would replace the ethanol housed in one of Zarco 66’s fuelling tanks, and a gasoline that is likely to result in far fewer sales than the ethanol blends that would be available if Zarco 66 maintained the current ethanol contents.[Quote] The station has two fuel tanks, one containing regular gasoline and a second that previously contained premium. Zarco, with the help of a DOE grant, converted this second tank for straight ethanol and by using blender pumps offers customers E85. Now from ConocoPhillips point of view, the US government (DOE), has assisted a competitor to to replace it's product with a competitors using ConocoPhillips tank.. ConocoPhillips argues the newcomer should install it's own tank, not simply take ConocoPhillips facility, intended for ConocoPhillips customers wanting Premium gasoline. ConocoPhillips, would argue that it's the same as a Burger King franchisee, replacing some products with Macdonald's products (with the aid of the Federal government). For those who hate oil companies, or support mandated ethanol, the issue is simple, ConocoPhillips must be the bad guy. But RFA president and CEO Bob Dinneen, is also a lobbyist, for a huge industry, highly paid to spin the issue from his members point of view. The whole issue is pretty sad, since both fuels are eventually bound for extinction.
      diffrunt
      • 1 Year Ago
      Real gas costs 10% more, gets 20% better mileage, doesn't gum up your stored equipment.
        carney373
        • 1 Year Ago
        @diffrunt
        "Real" gasoline wrecks the environment, crashes our economy, props up tyrannies, spreads pro-terror extremism, and even funds terrorism. If we all used ethanol and some oily Mideasterner sidled up to you and tried to sell you on switching to gasoline, with the above effects being "minor drawbacks", would you take the deal?
          Marcopolo
          • 1 Year Ago
          @carney373
          @ Joeviocoe Joe, how do I explain this to you ? Real world economics don't operate on ideological concepts, (as Greece has found out!). In the real world, national economies must deal with reality, or pay the price in the suffering of it's citizens ! The entire 20th century was created by the "Age of Oil". All the great advances in industrialisation, technology, travel, trade, communications, and social organization, was created by fossil fuel. First coal, then oil. This is a fact. Modern economies need vast amounts of cheap energy to survive. More importantly, modern economies have become dependant on the vast surpluses created by oil. The profits from oil companies flow back to the US in highly complex ways. If the US buys crude oil from another nation, a large percentage of those payments are usually invested back into the US, the US also exports high priced, value added goods back to those nations. Oil profits underpin almost the entire western world retirement industry. Remove those profits and watch taxes rise ! "means absolutely nothing that they pay so much in taxes (or employ so many people" Tell that to the millions of people dependant on this industry ! (or don't they count in your idealistic world ?) . Like most amateur "armchair economists", you mean well, but your simplistic idealism is flawed in logic. You want the oil industry to stop investing oil production, so the money can be spent on developing alternatives. But if there are no more oil profits, where would this money come from ? The real problem, is not that we live in an oil energy driven economy, but that the Golden Goose is finding it harder and harder, to lay eggs ! Oil depletion is occurring rapidly, the only reason is not yet that evident, is that oil exploration and extraction technology has been able to keep pace with demand. But that's can't continue for much longer. There are no simplistic solutions for this very complex problem. The best the developed world can do is try develop technologies to provide a soft economic landing as the 'Age of Oil', enters it's long twilight.
          Joeviocoe
          • 1 Year Ago
          @carney373
          "Real Gasoline, is the largest US taxpayer, and at the highest rate. " So how does that industry pay those taxes... with money from consumers,.... consumers who are locked into a paradigm of limited choice.... pay higher and higher gasoline prices, even while the corporations who supply gasoline make record profits. It is NOT the Gasoline industry that pays taxes... it is the American people., because they have no choice. When using some misleading statistics, it is important to know that it means absolutely nothing that they pay so much in taxes (or employ so many people). Those numbers are so high because of all of the dependencies within our society (and influence in Gov't)... which require that the industry be so large. -------------------------- Marco, .. what you are spouting is another translation of that, "TOO BIG TO FAIL" CRAP! They got TOO BIG, but that doesn't mean we should protect that. Times are changing... and if you are employed directly or indirectly by the OIL Industry... THIS IS YOUR WARNING.... get job training in another field and/or be prepared to move. It will be your own fault if (and when) they start cutting back... and if you are left with no job. Instead of defending TOO BIG TO FAIL industries... use your time, energy and yes, money to look toward the alternatives. Too much money is spend Lobbying to prevent change... money that could be spend adapting to change.
          • 1 Year Ago
          @carney373
          Gasoline doesn't wreck environment. Ethanol induces fetal alcohol syndrome and causes soil degradation through use of pesticides. Ethanol can never replace gasoline due to population growth and increase in demand of fuel.
          Marcopolo
          • 1 Year Ago
          @carney373
          @Dave D Dave, this sort of argument always takes place when realists meet wishful idealists. The simple fact is, there is no ' Unicorn Farts industry" ! Nor is any alternate energy able to replace the vast economic benefits and surpluses produced by the Oil Industry. These are going to be real economic problems for not just the US, but the world economy as the effects of oil depletion begin to deepen. The loss of oil production in Mexico, a nation over 68% dependant on oil as the basis for it's economy, is going to present the US with a real security problem. Both Iraq and Iran, are selling oil to Russia and the PRC. This lessens US (and Western) security. The PRC buys on a barter system, effectively locking out competitors. It not the just taxes that Big Oil pays, or the millions of jobs it creates, it's the huge profits it creates the guarantee investment in the Western worlds retirement industry. This sector is the most expensive and fastest growing demographic component of Western economies. Without these complex factors, no economy can survive. Just hating oil companies, while inventing fantasy solutions is pointless. Electricity, H2, ethanol, bio-diesel, methanol or even unicorn farts, none of these exist as a substitute for transport fuel, without heavy government subsidies. None of the industries generate the sort of surplus wealth and investment that's created by the oil industry. Just creating a bogeyman (the oil industry) to hate, while inventing impractical solutions, doesn't solve real economic problems created by energy depletion.
          Dave D
          • 1 Year Ago
          @carney373
          The other part I don't understand is when people defend Big Oil because "they pay so much in taxes". What do you think would happen if we all ran our cars on unicorn farts? We'd be paying taxes on those instead, and they'd be about the same when we finished the game. Big Oil is not some saint because they pay taxes. If the American fleet was magically 100% BEV or FCV tomorrow, then we'd be paying the same amount of taxes on electricity or hydrogen. Politicians would just shift the taxes....look what they're already doing with BEVs in Oregon. No, I'm sorry but you guys have to find a different argument to defend their sainthood. And the same goes for jobs. If we were all running cars on hydrogen, then those oil jobs would shift to H2 production/shipping and we would be working there. Did I mention that electricity, H2, ethanol, bio-diesel, methanol or even unicorn farts, NONE of them, require us to involove our military in the middle east for stability? But you can bet your @ss that oil does.
          Joeviocoe
          • 1 Year Ago
          @carney373
          "There is absolutely no real connection between the oil industry and terrorism" Not terrorism per se... but certainly the Middle East as a whole. Even though most of our oil comes from Canada... the fungible nature of Oil means that the largest global holder still has the biggest influence on the price. If this weren't so, we would not be spending so much money serving as the nation defense strategy of Saudi Arabia, Kuwait, UAE, etc. I've been to those places... and their military strategy is to defend their borders for about 72 hours... until U.S. troops arrive. THAT is about oil. We don't care about dictators if they attack their own people in a country without oil. But if they start stepping over into an oil rich country... best believe we go to war.
          Marco Polo
          • 1 Year Ago
          @carney373
          @ carney373 Here's a little reality check ! Real gasoline provides 2 million American jobs directly, 28 million indirectly. Real Gasoline, is the largest US taxpayer, and at the highest rate. Real Gasoline is 26.9% of the total US economy ! The Oil industry is America's most profitable industry. There is absolutely no real connection between the oil industry and terrorism (unless you think that Canadians are likely to attack you). Without the Oil industry, there is no recognisable US economy ! The problem is that the world, including the US, is beginning to have to start planning for the reality of the real economic hardship and havoc of rapidly advancing Oil depletion. Developing sustainable economic alternate energies must be developed to replace oil, but corn based ethanol is a dead end. Sadly, the US corn based Ethanol Industry is a failed replacement fuel. Using corn as a feedstock to produce ethanol has proved uneconomic, unreliable, environmentally harmful, and logistically impractical. It should be a dead industry, but to satisfy the powerful farm and big Agri-lobby , the US federal government retains mandating the use of ethanol to keep this economically obsolete industry in existence. Worse, it helps eke out the use of gasoline, to the detriment of more viable alternatives, like EV's..
          Marcopolo
          • 1 Year Ago
          @carney373
          @ Joeviocoe As for ' terrorism' , the fact that some anti-American terrorists are citizens of oil rich nations, is purely coincidental. The idea of terrorists needing a lot of money to operate is a fantasy invented by US (and other) government agencies, to justify huge budgets and draconian legislation restricting personal liberty. The most infamous terrorist attacks, were committed by small organisations, with very little funding, and only a small percentage by citizens of oil rich nations. Us national defence policy, is not just about oil ! The US is eager to get involved in the civil War in Syria (a serious mistake, but no Oil ) The US military was involved in Lebanon, Afghanistan, Granada, Kosovo etc (no oil) still boycotts Cuba etc, (no oil ). It's pointless railing against an industry so interwoven into the western world, without any adequate replacement strategy.
          2 wheeled menace
          • 1 Year Ago
          @carney373
          Why, i heard about our largest oil suppliers waging jihad on the mind of our teens the other day.. i think his name was 'Bieber' or something.
          raggtopp
          • 1 Year Ago
          @carney373
          carney, where do you come up with such a DUMB statement, less then 100 years ago we were cooking, heating with coal and wood. We read by kero and a 50 years before by whale oil. The streets were full of horses. Gas from crude drives the economy and everything else..
        brotherkenny4
        • 1 Year Ago
        @diffrunt
        Don't we just hate it when americans make money during a democratic administration and wouldn't we prefer to pay Canada or our terrorist friends in the Middle East rather than those fat farmers from Iowa.
      VL00
      • 1 Year Ago
      Ethanol (as its currently produced) is NOT a path to energy independence. And it can't go away fast enough.
      Giza Plateau
      • 1 Year Ago
      The more you tighten your grip the more systems will slip through your fingers.
      Kristen
      • 1 Year Ago
      So mister stinky hands...find your foresight yet? It's over there ---> next to contract compliance.
      raktmn
      • 1 Year Ago
      More on the Federal Antitrust complaint that Zarco has filed against ConocoPhillips: "According to material received by the Digest, ConocoPhillips’ activities may be in violation of the Sherman Antitrust Act and the Clayton Antitrust Act, as well as other laws with respect to fair competition. ... The Sherman Antitrust Act According to RFA, “As an initial matter, the oil industry is enforcing a classic “tying” arrangement in violation of Section 1 of the Sherman Act. A tying arrangement is “an agreement by a party to sell one product but only on the condition that the buyer also purchases a different (or tied) product.” Eastman Kodak Co. v. Image Tech. Servs., Inc., 504 U.S. 451, 461 (1992). As the Supreme Court has long recognized: “Such an arrangement violates § 1 of the Sherman Act if the seller has ‘appreciable economic power’ in the tying product market and if the arrangement affects a substantial volume of commerce in the tied market. Id. at 462 (quoting Fortner Enters., Inc. v. U.S. Steel Corp., 394 U. S. 495, 503 (1969)).” “In addition, the oil industry’s conduct is contrary to the Gasohol Competition Act of 1980. That legislation makes it unlawful to “unreasonably discriminate[] against or unreasonably limit[] the sale, resale, or transfer of gasohol or other synthetic motor fuel of equivalent usability.” 15 U.S.C. § 26a(a)(2) http://www.biofuelsdigest.com/bdigest/2013/03/20/antitrust-complaint-against-conocophillips-filed-over-anti-competitive-activities/
      Letstakeawalk
      • 1 Year Ago
      Thanks for the clarification, Marcopolo. Of course, I meant that Mr. Zaremba should be willing to take his lumps to accomplish his goal. If he indeed intends to make the break with CP, then of course he should be held to the terms of his contract and the penalties for breaking them. It might hurt him financially, but if he has to pay a substantial price to get the monkey off his back, then that's the cost of doing business.
      Marcopolo
      • 1 Year Ago
      @ EVSUPERHERO " Why would Conoco do such a thing?" Firstly, you have only read a one-sided report from a the publicity organ of the Ethanol Industry, that doesn't automatically make it wrong, but unlikely to be balanced. Secondly, Conoco-Phillips is in the oil business. Conoco-Phillips has no 'moral' obligation, other than sell own oil products, one of which is premium fuel. It fact the directors of Conoco-Phillips have a legal obligation to their shareholders to do just that. Just because you have an ideological aversion to oil companies, doesn't make them 'evil' ! Would you object to the rescue helicopter that rescued your injured child, or the high-speed ambulance and Police escort that raced your child to a hospital , because they ran on fuel supplied by Conoco-Phillips ? Would you object to the hospital saving your child's life by using medicine's and technology developed from oil products? If Scott Zarema wants to sell ethanol mix, he is absolutely entitled to do so, that his constitutional right. No one is stopping him opening, or operating a gas station selling (DOE funded) ethanol with any other gasoline brand However, he can't do so as a Conoco-Phillips 'franchisee', (without the permission of Conoco-Phillips). That's the point.
      Giza Plateau
      • 1 Year Ago
      Evil as always Marco
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