Iowa biofuels deal will require most gas stations to sell E15

Source: BY: KATIE AKIN, Capital Dispatch • Posted: Tuesday, April 26, 2022

Small fueling stations will be exempt from requirements, under Senate amendment

biofuel gasoline gas pump ethanol fuel

Lawmakers are moving forward with a long-awaited compromise that will require most Iowa gas stations to sell higher ethanol blends. (Photo by Perry Beeman/Iowa Capital Dispatch)

Iowa gas stations would be required to sell fuel with a higher ethanol blend under a long-awaited biofuels deal among Republican lawmakers in the House and Senate.

Molly Severn, legislative liaison for Gov. Kim Reynolds, said the bill was “the result of significant compromise from everyone along the fuel supply chain, from farmers to fuel retailers.”

“This bill helps to reinforce Iowa’s economy at a time when we’re seeing soaring inflation and energy prices, as well as supply chain and workforce challenges,” Severn said. “We’re preparing Iowa to meet these headwinds and come out stronger on the other side.”

The latest version of House File 2128 requires fueling stations to sell E15, a gasoline blend with 15% ethanol. Most stations that carry ethanol currently sell a 10% blend.

Gas stations that sell fewer than 300,000 gallons a year would be eligible for a waiver, under the amended bill. That amounts to about a third of Iowa gas stations, which account for just 6% of overall sales, according to Sen. Waylon Brown, R-Osage.

Fueling stations are eligible for state funding to help them make the required infrastructure changes to sell E15. The smallest retailers could receive a state grant for up to 90% of an upgrade cost.

“The reality is, most of these small retailers, they’re going to have the opportunity to opt out of this,” Sen. Dan Dawson, R-Council Bluffs, said. “But we want to make sure just because you have a waiver doesn’t mean you can’t still participate if you want to.”

An overwhelming bipartisan majority in the House passed the biofuels bill in early February, soon after the legislative session began. On Monday, the Senate finally took up the legislation, amending it to reflect a compromise between both chambers.

Several Democrats raised concerns the proposal was a “mandate” for businesses and noted that the summertime sales of E15 may not continue. President Joe Biden visited Iowa earlier this month to announce the temporary sale of year-round E15. Usually, fueling stations may not sell E15 from June until September due to pollution concerns.

“I will hold my nose and vote for this today, very reluctantly… and primarily because I have in my community a biodiesel plant,” said Sen. Pam Jochum, D-Dubuque. “But I’ll be darned if I can figure out why we think mandating this is a good idea on E15.”

Brown said Reynolds could waive the requirement to sell E15 if federal law once again prohibited it in the warmer months.

A Senate committee approved the bill on Monday afternoon. The Senate and House are expected to pass the legislation later this week.

The ethanol bill was one of several proposals held up in negotiations among the two chambers and Reynolds, pushing the session past its allotted 100 days. Dawson said the deal was a step in the right direction toward adjournment.

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