Any week now, the U.S. Food and Drug Administration is expected to propose rules that could govern how and where electronic cigarettes can be sold. Hanging in the balance is a fast growing and strategic market for this booming industry the school yards of America.

E cigarette use among middle and high school students doubled to 1.78 million of them in 2012, compared with the year before, according to a recently published report from the U.S. Centers for Disease Control and Prevention. Of that total, about 160,000 minors had never smoked traditional cigarettes. The CDC sees this as worrisome because health advocates fear e cigarettes can be a gateway to traditional tobacco products. About 90 percent of adult smokers in the U.S. began puffing by the age of 18, according to the CDC, which relied on self reported data from the 2012 National Youth Tobacco Survey for its findings.

E cigarettes heat liquid nicotine to create an inhalable water vapor without the tar of normal cigarettes. For the moment, marketers operate with few of the regulatory limits that apply to tobacco companies such as Reynolds American (RAI) and Philip Morris (PM).

Although e cigs now account for only 1 percent of U.S. cigarette sales, the market will approach $2 billion in sales by the end of 2013 and may exceed $10 billion by 2017, Bonnie Herzog, an analyst at Wells Fargo & Co. in New York told Bloomberg News. Demand for the smokeless devices could surpass that for traditional cigarettes over the next decade, according to Herzog.

Big tobacco player Lorillard (LO), which sells Newport and Kent brand cigarettes, now gets almost 4 percent of its revenue from its Blu e cigarette line. The company s stock has outperformed the broader S&P 500 stock index this year.

As things stand, nothing prevents e cigarette makers from advertising the devices, unlike restrictions faced by traditional tobacco product purveyors. Lorillard hired comedic actress and former Playboy model Jenny McCarthy to promote its Blu product.

While there are no conclusive medical studies as to the safety of e cigarettes, the American Lung Association has expressed concern about potential health hazards, given the wide variation of chemicals in the 250 different brands for sale in the U.S.. The health advocacy group says that in initial lab tests conducted by the FDA in 2009, detectable levels of toxic cancer causing chemicals were found, including an ingredient used in anti freeze, in two leading brands of e cigarettes and 18 various cartridges.

Aside from the upcoming FDA rules, a dozen states are also weighing whether to regulate and tax e cigarettes something the e cigarette industry is lobbying against. Our goal as an industry is to distinguish ourselves from cigarettes, and there s a very important reason that we want to be defined, at the state level, not as a tobacco product, Eric Criss, president and chief executive of the Electronic Cigarette Industry Group, told the Washington Post. We believe the product is a good alternative, and the goal should be to move people down the risk ladder from cigarettes.

Regardless of the future of e cigs in middle schools, the devices are proving a big hit in the workplace.

Bbc news – public ‘seem to like’ e-cigarettes

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She says “It’s really important that electronic cigarettes are allowed to be used in public as widely as possible so that as many smokers as possible are aware that they have this option.

“The more smokers we can get to make the switch, the bigger the public health gain we can achieve.”

E cigarettes work by vaporising liquid nicotine. There’s no tobacco, no smoke. It’s the smoke in normal cigarettes that kills.

But shoppers had mixed views about Ms Devlin using her e cigarette inside.

“I don’t like it,” one woman said. “I don’t like anything that leads to addiction. It’s related to cigarettes isn’t it ? It’s nicotine.”

“It’s a substitute for cigarettes,” said a male shopper. “I think it’s great for people who are trying to give up smoking.”

Need for a ban?

The smoking ban doesn’t apply to e cigarettes because there’s no smoke. It means, in theory, they can be used anywhere trains, planes even hospitals.

When asked by BBC Breakfast “Would you feel uncomfortable if someone used an e cigarette near you are your family?” 75 % said no.

And asked if e cigarettes should be banned in public places, 34% said yes but 62% said no.

The debate around e cigarettes has sharply divided medical opinion. Some see them as a huge potential public health prize that could save millions of lives. Others worry about the effects of their long term use, their regulation and their safety.

“It is clear they are less harmful by several magnitudes than smoking,” says Dr Ram Moorthy, from the British Medical Association.

“But we still need to have a much greater evidence base about how safe they are.”

The BMA has called for e cigarettes to be banned in public places.

“Our concern with the use of e cigarettes is that it normalises behaviour that has become socially unacceptable,” says Dr Moorthy.

“Our biggest concern is that something that looks like smoking becomes glamorous again and may be attractive to children.”

Many have now followed the BMA advice. Airlines, train companies and the pub chain JD Wetherspoon have all banned the use of e cigarettes, as has the University of London, which introduced a ban last month.

“We were heavily influenced by the advice from the BMA,” says Kim Foster, from the university.

“We had people sitting next to each other in cafes and actually saying, ‘Well, you’re smoking, you shouldn’t be smoking in here,’ and arguments were developing.

“At one point a security guard had to be called. Arguments were developing and you just don’t want that.”

Many other institutions, offices, and pubs do allow e cigarettes. The government says it’s up to individual companies and institutions to determine their own policy.

The result is somewhat bizarre. E cigarettes can be used for example in Asda supermarkets but not in Sainsbury’s.

Back in the shopping centre, Ms Devlin cannot use her e cigarette in an open air Starbucks but can just outside, where it becomes Westfield.

“The current situation where you’ve got different rules in different places is reflective of the absolute and utter confusion there is,” she says.

If the BBC poll is right, the public seems to be fairly relaxed about e cigarettes at a time when more and more places are deciding to ban them.