Governors Pushing Higher Biofuel Blends in Iowa and Minnesota

Source: By Chris Clayton, DTN Ag Policy Editor • Posted: Tuesday, February 16, 2021

The governors of Iowa and Minnesota are moving along parallel tracks to push for higher blend requirements in their respective states for ethanol and biodiesel blends.

In Iowa, the Des Moines Register reported over the weekend that GOP Gov. Kim Reynolds’ plan for a renewable fuels standard in the state has set up a battle between agricultural and biofuel groups against Iowa convenience store giants Casey’s and Kum & Go, as well as trucking and transportation firms, and truck stops. Reynolds’ proposal calls for requiring retailers to sell fuel with at least 10% ethanol or 11% biodiesel.

Iowa is both the nation’s largest ethanol producers and biodiesel producer. A study by the Iowa Renewable Fuels Association showed the fuel mandate would generated demand to sell 117 million gallons more of ethanol and 203 million gallons of biodiesel from 2022 to 2026. The plan would generate nearly $460 million in economic activity by 2026, the IRFA study stated.

Monte Shaw, executive director of the IRFA, told the Register that retailers would claim tax credits to help offset the costs of infrastructure improvements. The legislation would drive more investment in E15 pumps statewide. Right now, only about 300 retailers out of 2,400 statewide are offering E15. Increased infrastructure investment offering retailers as much as 70% of the costs would spur more E15 pumps. Requiring more, cleaner-burning ethanol in fuel is “going to boost the economy, it’s going to clean up the emissions from our air, and it’s going to add household income,” Shaw said, adding, “It’s good for Iowa,” especially rural Iowa.

Countering the farm groups, the Fuel Choice Coalition, led by the convenience stores and truck stops, state the legislation would raise prices for Iowa motorists and costs retailers at least $1 billion to meet the requirements for pumps and other infrastructure. Delia Meier, vice president of I-80 Group, which owns the Iowa 80 Truckstop in eastern Iowa, told the Register that truckers would simply pass by Iowa to get their fuel.

“Our customers are going 1,500 miles before that have to fill up … so it’s very easy to bypass Iowa,” Meier said.

Further north in Minnesota, Democratic Gov. Tim Walz is pushing legislation in his state that would increase the minimum biofuels content in gasoline to 15%. The bill will go before the state’s Senate Agriculture Committee this week, according to multiple TV and radio reports from Minnesota. Walz, as chair of the Governors’ Biofuels Coalition, also sent a letter to President Joe Biden asking his administration to consider some executive orders that would spur more biofuel use. One proposal would be to tighten the Clean Air Act by replacing aromatics in gasoline with cleaner alternatives. That would force a shift to higher octane ethanol.

Des Moines Register https://www.desmoinesregister.com/…

KEYC: https://www.keyc.com/…

Chris Clayton can be reached at Chris.Clayton@dtn.com

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