Automakers and engine manufacturers are suing the U.S. Environmental Protection Agency over a rule that would allow the sale of gasoline blended with 15% ethanol.

In October, the EPA granted a partial waiver to Growth Energy, an ethanol industry group, approving the sale of E15 for cars and light trucks made since 2007. It's an increase from the current blend of 10 percent ethanol.

The newly formed Engine Products Group sued the EPA, saying the higher blend could damage the engines of boats, older cars and carbureted equipment such as chain saws. They say it potentially opens manufacturers to liability lawsuits, and that the partial nature of the waiver violates the Clean Air Act.

"It is, almost by definition, misfueling," said Kris Kiser, executive vice president of the Outdoor Power Equipment Institute, speaking on behalf of the plaintiffs.

Kiser also said the industry wasn't given enough time to review the engine safety and performance data submitted with Growth Energy's waiver application.

The coalition, made up of the Alliance of Automobile Manufacturers, the Association of International Automobile Manufacturers, the National Marine Manufacturers Association and the Outdoor Power Equipment Institute, wants the rule overturned and sent back to the EPA.

"We will review and respond appropriately," an EPA spokeswoman said.

No evidence of damage

Brian Jennings, executive vice president of Sioux Falls-based American Coalition for Ethanol, said even though E15 will be allowed only for newer cars, it's safe for every car on the road.

"There is not a shred of evidence to suggest that E15 would do damage in a motor vehicle," he said.

The Renewable Fuels Association, an ethanol industry group, said the EPA could have avoided market confusion if it had approved ethanol for
more vehicles. The agency is considering the higher ethanol concentration for vehicles made between 2001 and 2006. It's unclear whether they ever would approve the blend for cars made before 2001.

Warning labels studied

The EPA is studying how best to label pumps to warn drivers that E15 is allowed only for late-model cars.

"Nobody believes that's adequate," Kiser said. "Price drives this debate." If E15 is cheaper than unblended fuel, motorists, boaters and landscapers alike will choose the money-saver, he said.

Caveat emptor, Jennings countered.

"The same argument can be made - what about people who mistakenly put diesel in their cars?" Jennings said. "At some point, the responsibility falls on the owner of a vehicle, or truck, or chain saw."

A Poet spokesman said the Sioux Falls-based company had nothing to add to a statement by  Growth Energy CEO Tom Buis that states, in part: "Concerns about misfueling are premature, as EPA is drafting a robust labeling rule and will conduct a vigorous public education campaign, and we are confident that the process will be successful."

Ethanol credit extended

The EPA has said a congressional mandate for increased ethanol use can't be achieved without allowing higher blends. Congress has required refiners to blend 36 billion gallons of biofuels, mostly ethanol, into auto fuel by 2022.

The EPA challenge comes a few days after Congress extended the ethanol blender credit as part of the $858 billion tax cut package. A tariff on foreign ethanol also was extended.

In another bright spot for the industry, NASCAR has announced that it is swapping racing fuel for an E15 blend next season. A spokesman said the teams had to slightly modify the fuel cell in each car to accept the new blend, and the result was slightly better performance.

The Associated Press contributed to this report.