Ethanol Blog

LINCOLN, Neb. (DTN) -- Iowa Republican Gov. Kim Reynolds on Tuesday signed into law legislation that will expand access to E15 and other biofuels throughout the state by 2026.

The Iowa Biofuels Access bill also will expand the availability of B20, a 20% blend of diesel and biodiesel.

The law goes into effect at a time when federal policy on E15 remains in limbo. Governors from eight states recently petitioned the EPA to conduct a rulemaking that would allow for the permanent year-round sale of E15. Earlier this year, the Biden administration granted a waiver to allow the year-round sale of E15 through 2022.

"I've never been prouder than I am today to be the governor of the number-one ethanol and biodiesel-producing state in the country," Reynolds said in a statement.

"Iowa's biofuel production powers our economy and fuels the world, and this historic bill sets the stage for the single largest expansion of biofuels in our state's history. We're sending a message that can't be ignored: America's energy is growing right here in Iowa's fields."

Grant Menke, director of market development at the Iowa Corn Growers Association, said in a news release the law would give Iowans more choices at the pump.

"Today there are about 300 stations in Iowa that offer E15," he said. "When this bill is fully implemented, we will see about 1,000 more stations offering E15."

ICGA President Lance Lillibridge said making E15 more widely available would allow drivers to save an average of 10 cents per gallon when they fill up. He said the law "creates additional markets for Iowa corn farmers. It's a win-win for Iowa."

ICGA said just 17% of fuel stations in Iowa provide E15, also labeled as Unleaded 88.

Iowa Renewable Fuels Association Executive Director Monte Shaw said in a statement the Iowa law is a "nation-leading policy" that will help motorists more easily access "lower-cost biofuels" across the state.

"Iowa is now the first state to have an E15 program and the first state to incentivize B30," he said.

"Iowa is now truly the leader in both biofuels production and biofuels policy. This would not have happened had Governor Kim Reynolds not introduced the bill and made it a top priority this legislative session. At a time of record-breaking fuel prices, the governor's biofuels access bill will provide relief for consumers and long-term markets for farmers. It is not exaggerating to say that the Iowa Biofuels Access bill is the most important piece of biofuels legislation ever enacted in Iowa."

The law will increase consumer access to E15 and B20 while also providing fuel retailers additional help to upgrade fueling infrastructure.

Poet LLC founder and CEO Jeff Broin said the law is a "game-changing" standard.

"Iowa today, America tomorrow," he said.

"We see a nationwide market for E15 on the horizon. E15 is fueling freedom and Iowa is leading the way by expanding market share for American-made biofuels that Russia and OPEC can never take away."

Growth Energy CEO Emily Skor said the law would expand on the success E15 already is seeing in Iowa.

"At the peak of high gas prices this spring, Iowans across the state were saving about 30 cents per gallon at the pump while filling up with E15," she said in a statement.

"These meaningful savings will be accessible across the state, all year long. Gov. Reynolds' legislation also allows drivers to make a difference for the environment by simply filling up at the pump."

Growth Energy said in a news release statewide E15 in Iowa could cut climate emissions by 180,000 metric tons -- or the equivalent of removing almost 40,000 vehicles from the road.

On the biodiesel side of the ledger, the law also increases a biodiesel production tax credit from 2 cents to 4 cents per gallon and updates the state's renewable fuel infrastructure program.

The law extends current fuel retailer tax credits for B11 and higher, while introducing new credits for higher blends like B20 and B30 -- a first-in-the-nation policy.

"We congratulate Iowa on this significant legislation, helping to strengthen the biofuels corridor throughout the Midwest," Clean Fuels Alliance America CEO Donnell Rehagen said in a statement.

"Iowa joins the ranks of Illinois, Minnesota and others with some of the most forwarding-thinking legislation that values the production and use of biodiesel. Along with renewable diesel, it is our nation's best option here-and-now to decarbonize the heavy-duty transportation and home heating oil sectors."

Iowa produced an estimated 340 million gallons of biodiesel in 2021, making it the top biodiesel-producing state, according to Clean Fuels Alliance America.

Grant Kimberley, Iowa Biodiesel Board executive director and Iowa Soybean Association senior director of market development, said the new law would offer a "new cushion" for biodiesel producers in Iowa.

"Worldwide uncertainty and fuel-price instability also impact consumers," he said.

"A diverse fuel supply with more low-carbon fuel made in America benefits everyone from soybean farmers to the end consumer."

Read more on DTN:

"E15 Measure Advances in Iowa Legislature," https://www.dtnpf.com/…

"Biden in IA: Year-Round E15 Coming Back," https://www.dtnpf.com/…

"Eight States Petition EPA on E15 Change," https://www.dtnpf.com/…

Todd Neeley can be reached at todd.neeley@dtn.com

Follow him on Twitter @DTNeeley

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