An ethanol trade group submitted a formal request to the U.S. Environmental Protection Agency on Friday to boost the allowed ethanol-to-gasoline blend rate as high as 15 percent from the current cap of 10 percent.

The higher blend rate would reduce the country's dependence on foreign oil and help the sagging U.S. economy by generating as many as 136,000 new jobs and injecting $24.4 billion into the American economy each year, said Growth Energy,

The EPA has 270 days to review, collect public comment and make a decision on Growth Energy's request. In the meantime, it could decide to allow a jump to a 12 percent or 13 percent blend, the group said.

If the EPA acts swiftly, a higher blend of ethanol will help us jump-start the economy while further reducing our dependence on foreign oil, General Wesley Clark, co-chairman of Growth Energy, said in a statement. I hope the EPA will approve this request expeditiously.

Ethanol groups have complained the 10 percent cap stifles development and growth of the alternative fuel industry, which has been hit hard by volatile prices and slumping fuel demand.

But automakers worry higher blends of ethanol, made mainly from corn, could hurt engines of older cars.

The EPA will determine whether a higher blend would harm emission control systems, including catalytic converters, in vehicles.

A preliminary study released last October by the Energy Department found emissions and exhaust temperatures in cars running on 15 percent and 20 percent ethanol did not change significantly from those using traditional fuels.

The DOE cautioned more studies were needed to determine whether higher blends of ethanol could be used.

In its bid to raise the cap, Growth Energy cited studies showing cars are not harmed by using 15 percent ethanol.

The auto industry says it supports higher use of alternative fuels -- particularly more use of E85, or gasoline that contains 85 percent ethanol, which millions of special new flex fuel cars can burn.

But automakers have said more testing is still needed to see whether higher blends harm older, regular cars. Ford Motor Co downplayed a report on Thursday that it had endorsed the use of 15 percent ethanol blends in gasoline.

The federal government's so-called U.S. renewable fuels standard requires the use of 11.1 billion gallons of renewable fuels in 2009 with much of the output coming from corn.

In 2022, the energy law requires the U.S. gasoline supply to include 36 billion gallons of renewable fuels, 15 billion gallons from corn-based ethanol and 21 billion gallons from advanced biofuels, such as ethanol from cellulose.

(Editing by Christian Wiessner)

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