Reynolds requires all new state diesel vehicles to use fuel at least 20% biodiesel

Source: By Donnelle Eller, Des Moines Register • Posted: Wednesday, December 4, 2019

Siouxland Energy ethanol plant halts production after RFS waivers dropped demand

Kelly Nieuwenhuis, Siouxland Energy Cooperative board of directors chairman, talks about the decision to halt ethanol production after RFS waivers caused a major reduction in demand.

Gov. Kim Reynolds gave a boost Tuesday to Iowa’s renewable fuels industry, requiring that all new state-owned diesel-powered vehicles — from cars and trucks to snowplows and graders — be able to use at least 20% biodiesel.

Reynolds signed the executive order at the Iowa Farm Bureau Federation’s annual meeting in Des Moines.

Biodiesel purchases help boost demand for U.S. soybeans and its oil, one of the materials used to make the biofuel. Iowa grows the nation’s second-largest soybean crop and is the country’s biggest biodiesel producer.

Iowa also produces more ethanol than any other state and the corn used to make it.

The state mandate comes as ethanol and biodiesel plants in Iowa and nationally have struggled. The renewable fuels industry blames exemptions the U.S. Environmental Protection Agency has provided to the oil industry.

Since taking office, the Trump administration has provided 85 waivers that let the oil industry off the hook for blending about 4 billion gallons of renewable fuel into the nation’s fuel supply.

As a result, five ethanol and biodiesel plants have closed in Iowa, either permanently or temporarily. They’re among about three dozen plants that have cut production or closed nationally.

Reynolds and other state and national leaders are pushing the EPA to replace the gallons lost to waivers, based on a rolling three-year average.

“I won’t rest and we won’t rest until our message is understood — that 15 billion gallons means 15 billion gallons,” Reynolds said at the annual meeting.

► More: A timeline of Iowa’s response to the Trump administration’s 2019 ethanol waivers

The Renewable Fuel Standard, a federal mandate that requires ethanol and biodiesel to be blended into the nation’s fuel supply, calls for 15 billion gallons of ethanol to be blended annually. The waivers reduce that amount.

“It’s real people in places like Merrill, Crawfordsville, Emmetsburg and Sioux Center whose biofuels facilities have been shuttered, who live with the decisions made in Washington, D.C.,” Reynolds said.

Donnell Rehagen, CEO of the National Biodiesel Board, said some engine manufacturers believe they haven’t received “clear signals from customers that biodiesel support matters to them.

“Iowa has once again gone to bat for biodiesel by sending a clear signal with its buying power,” Rehagen said.

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The Iowa Department of Transportation said it began using biodiesel blends in 1994, and now uses B20 — fuel that contains 20% biodiesel and 80% petroleum-based diesel — most of the year in virtually everything with a diesel engine.

In a statement, Reynolds said renewable fuels “remain essential to the health of the agricultural economy, sustainable environmental commitments and employ thousands of Iowans.”

Iowa has 11 biodiesel plants that produced 365 million gallons of fuel in 2018. The state says the biodiesel industry supports the equivalent of 4,700 full-time jobs.