Negotiations expected this summer over revised ethanol mandate in Iowa

Source: By • Posted: Tuesday, May 25, 2021

(Corning) — Leaders in the biofuels industry are expected to go back to the negotiating table this summer after a proposed renewable fuel mandate in Iowa failed to pass the legislature this year.

Governor Kim Reynolds offered a bill that would require all gasoline sold in the state to contain at least 15% ethanol by 2025 and all diesel to include increased levels of biodiesel. A version of the bill cleared a few hurdles in the legislature, but never made it to the floor for a vote before the end of this session. Ray Gaesser is a farmer near Corning, who has long advocated for increased use of biofuels and is a former president of both the American and Iowa Soybean Association. He says it makes sense to use a product produced in the state.

“It really does make a lot of sense for Iowa to use the fuels that we produce here,” said Gaesser.  “Because we are number one in ethanol and biodiesel production, we need to take advantage of that.”

Pushback against the proposal came mostly from fuel retailers, including gas stations and bulk fuel suppliers, who argued the cost of upgrading equipment to handle the biofuels would cost $1 billion. Gaesser says the biofuels industry is open to working with retailers and says federal help could be available in the future for upgrades.

“In many of our stations — about 240 locations or more in Iowa — have E-15 available and lots of biodiesel at the major truck stops,” said Gaesser.  “It’s already beginning to be there.  We’re just trying to encourage that demand or increase that demand and provide jobs and opportunities for Iowa.”

Aside from hammering the details of a proposal for the next legislative session, Gaesser says farmers should help educate consumers on the benefits of using biofuels.

“It’s really good for not only our environment, but for our consumers at the same time,” said Gaesser.  “That’s the message that we want to share.  They can save money, they’re cleaning up the air by using Iowa renewable fuels and helping our economy at the same time.”

Corn growers in Iowa say an E-15 mandate would increase corn demand by 23 million bushels annually and would provide $140 million in additional economic benefit.

“On our farm, we’ve been using ethanol since 1986 and biodiesel for almost 20 years now and have had really good results,” said Gaesser.  “If you haven’t used it, try it.  I think you’ll like it.  You’ll like the savings in particular.  Talk to your legislators and say let’s invest in Iowa.  Let’s invest in Iowa’s fields and not in oil fields.”

The group FUELIowa represents fuel retailers and suppliers in the state. They say 550 sites would need to be upgraded to sell higher blends of ethanol and that they are in favor of letting the market dictate which kind of fuel is sold.