A new Iowa law will require more gas stations to carry E15. What does that mean for drivers?

Source: By Ian Richardson, Des Moines Register • Posted: Wednesday, May 18, 2022

PRAIRIE CITY — A new Iowa law will require most gas stations to offer fuel with higher blends of ethanol within the next four years, an effort to boost the state’s biofuels industry and increase fuel options for drivers.

Reynolds signed the law, House File 2128, on Tuesday while standing atop a trailer in a farm field near Prairie City, surrounded by Iowa lawmakers, farmers and renewable fuel advocates.

During her remarks, she touted the state’s renewable fuels industry as a way to help those facing rising gas prices, saying the new legislation “couldn’t have come at a better time.”

“I’ve never been prouder than I am today to be the governor of the No. 1 ethanol and biodiesel producing state in the country,” she said.

Both Republicans and Democrats have touted E15, a slightly less expensive fuel with up to 15% ethanol blended with gasoline, as a way to help lessen the sting at the pump for drivers as gas prices spike across the country.  Almost all gasoline sold in the United States is E10, blended with 10% ethanol.

More:Kim Reynolds signs bill mandating most Iowa gas stations sell fuel with higher ethanol blends

Reynolds’ legislation drew support this year from both Republicans and Democrats at the Iowa Capitol. And last month, President Joe Biden visited Iowa to announce he would temporarily lift restrictions on the sale of E15 in the summer, a move applauded by members of both parties.

But in her support for the law, Reynolds was also critical of the Biden administration’s push for electric vehicles, saying biofuels are a better answer.

“The administration is encouraging Americans who can’t afford gas to buy an electric car,” she said. “That’s no solution.”

Reynolds and biofuels advocates have been pointing to expanding biofuels as a benefit to Iowans at the pump, but Iowa’s new law won’t necessarily ease gas prices for Iowa drivers right away.

More:More Iowa gas stations to sell fuel with higher ethanol blends under bill OK’d by Legislature

Here’s a closer look at how the new law could affect Iowa drivers.

How soon will my local gas station carry E15?

One of the goals of Iowa’s legislation is to expand access to E15 fuel. How soon it does — and whether it does in certain areas — will depend on a variety of factors.

Any gas stations built or upgraded starting next year must be compatible with E15, as well as with E85, or gasoline with 85% ethanol, and B20, which contains at least 20% biodiesel.

But the major milestone will come in 2026, when Iowa’s law will require gas stations to sell E15 gas.

But there are exceptions in the law for gas stations with older equipment and those that sell less than 300,000 gallons of gasoline per year. Those stations, which number in the hundreds, are eligible to apply for waivers.

The law also expands tax credits for fuel with higher blends of ethanol and biodiesel, and it tweaks Iowa’s Renewable Fuel Infrastructure Program to provide more generous cost-sharing for smaller gas stations that want to use state grants to upgrade equipment.

More:Here’s why Iowa Gov. Kim Reynolds applauds President Joe Biden’s E15 announcement

Just over 300 gas stations in Iowa reported selling E15 in 2021. That represents about 17% of the 1,744 gas stations that reported their sales to the state last year, although there could be more than 3,000 potential retail fuel stations in Iowa, according to an annual report published by the Iowa Department of Revenue.

There were 575 gas stations in Iowa that sold less than 300,000 gallons of gas in 2020, according to data provided by Senate Republican staff, accounting for about 5.8% of the gasoline sold in the state that year.

Monte Shaw, executive director of the Iowa Renewable Fuels Association, said he expects retailers to gradually come on board during the three-year window.

He estimated that up to 45% of stations could receive an exemption because they’re old enough or small enough to qualify, but that would still mean a large expansion by 2026.

“That would still be 1,000 new stations between now and the end of ’25,” he said.

More:As President Joe Biden visits Iowa, here’s what to know about E15

Will using E15 save me money?

E15 typically offers savings of around 10 cents to 30 cents at the pump, according to the Iowa Renewable Fuels Association.

But at the same time, a gallon of E15 doesn’t carry a driver quite as far as a gallon of E10, according to the U.S. Department of Energy, because the higher blend has slightly less energy.

Patrick De Haan, head of petroleum analysis for the fuel-savings app GasBuddy, said the fuel has a varied impact on mileage, depending on a person’s car and driving style. He recommended giving E15 a try for a few tanks to see if it results in savings.

“Generally, there’s anywhere from a 10- to 30-cent a gallon discount for E15, especially in a state like Iowa,” he said. “So it may be advantageous for people to still come out ahead, even if they do have a 1 to 2% decrease in fuel efficiency.”

Shaw said that while E15 may not get as much gas mileage in controlled settings like a lab, he doubts drivers would notice a difference.

“It’s barely discernible in a controlled setting. And it’s nonexistent in a real world setting,” he said.

More:Gov. Kim Reynolds, 7 other Midwest governors ask EPA for permanent, year-round E15 gas sales

Can my car use E15?

E15 is approved for use in cars and trucks from model year 2001 or newer, and older flex-fuel vehicles.

The U.S. Department of Energy says E15 should not be used in:

  • Motorcycles.
  • Vehicles with heavy-duty engines, such as school buses and delivery trucks.
  • Off-road vehicles, snowmobiles and boats.
  • Chainsaws and gasoline lawn mowers.

Access to E15 is typically limited in some states, including Iowa, from June 1 to Sept. 15 because the higher blend is believed to contribute to smog during summer months. Ethanol advocates say the concern is unfounded.

But Biden’s announcement in April will allow the sale year-round, on a temporary basis. Meanwhile, Reynolds and seven other Midwestern governors have sent a letter to the U.S. Environmental Protection Agency seeking a permanent waiver to sell E15 year-round.

The Register’s Stephen Gruber-Miller and Tyler Jett contributed to this report. 

Ian Richardson covers the Iowa Statehouse for the Des Moines Register. Reach him at irichardson@registermedia.com, at 515-284-8254, or on Twitter at @DMRIanR.