Eastern Iowa lawmakers plan major, yet unsettled changes to renewable fuel standards

Source: BY BENJAMIN FISHER, The Telegraph Herald • Posted: Monday, April 5, 2021

Several area lawmakers in the Iowa Legislature have advanced a bill that would mean major changes to rules regarding ethanol in gasoline and what customers would see at the pump.

Iowa House of Representatives Study Bill 185 passed the House Ways and Means Committee last week, with some bipartisan support. It would require that new gas station infrastructure support at least 10% ethanol products and that fewer pumps deliver gas with no ethanol. It also would create seasonal biodiesel standards, among other things.

The bill originated as a session priority of Gov. Kim Reynolds but looked very different when it passed the committee than when it was proposed. Republicans amended the bill with a strike-after amendment, which rewrote much of the language, just before the committee’s vote.

“We had looked at it and spent probably two full weeks talking to different groups about it,” said Iowa Rep. Lee Hein, R-Monticello, who chairs both the House Ways and Means, and Ag committees. “We’ve listened to most every group that is a stakeholder in this policy.”

Hein said he and Iowa Sen. Dan Zumbach, R-Ryan, have worked together with the opposed industries to find some common ground. Zumbach did not respond to requests for comment for this story.

The cornerstone of the resulting, amended legislation is that a 10% ethanol standard becomes the law of the land in Iowa.

“If the bill’s enacted, the E10 standard will come into effect upon enacted,” Hein said. “Basically, that’s what’s already offered at every retail station in the state. The E0 — the premium, no ethanol gasoline — will need a special use label on it denoting that it’s for motorcycles, chainsaws, lawnmowers, older vehicles — stuff that runs better on that.”

The bill also raises that standard to E15 in 2028.

Hein said the language allows some exceptions for smaller retailers.

“For the smaller stores, where infrastructure is not up to snuff, we’ve provided a waiver they can get from the (Iowa Department of Natural Resources),” Hein said. “Our goal was never to put anybody out of business. We just want to gently nudge them to sell biodiesel and biofuels.”

That nudge is not gentle enough, though, for the opposed industries. Every oil and gas station lobby in the state opposed the bill.

Iowa Rep. Lindsay James, D-Dubuque, voted in favor of the bill in committee but said the industry opposition was adamant.

“It has extremely significant opposition obviously from the petroleum industry,” she said. “Those who critique it say they are meddling in the free market.”

Iowa’s renewable fuel industry is behind the bill in a big way, including companies in the area such as Western Dubuque Biodiesel. General Manager Tom Brooks argued that the bill actually loosens restrictions for the customer.

“Right now, you’re being told that you can get at most 10% ethanol,” he said. “So you are getting mandated to have 90% gasoline.”

Brooks added that he thought the move would be good for Iowa’s economy.

“I currently ship a lot of product out of state,” he said. “This would mean my product could be kept in-state. The money would be kept here, rather than sending that more inexpensive fuel to distributors in other places.”

Hein, too, admitted that the “standard” language rubbed some members of his caucus the wrong way.

“We’re probably going to have a discussion about that,” he said. “Some see a standard as a mandate. On the flip side, there are a lot of things we pass in this chamber that we don’t realize are truly mandates. We mandated insurance companies to pay the same amount to telehealth claims as they did for inpatient office calls just a few weeks ago.”

James said her support for the bill to get it out of committee was just to keep the conversation going, understanding that given how new it was, the language was likely to change before a House floor vote.

“I voted for the bill knowing that it was an unfinished piece of legislation and there would be a lot of amendments moving forward, and knowing that the changes to it would likely make it stronger,” she said. “I know as Iowans, we want to make sure that we’re moving in a climate-friendly direction. Climate change is real. Science has solutions. Renewables are a part of that solution.”