Naig: Investment in Renewable Fuels is an Investment in Iowa
DES MOINES, Iowa (June 30, 2020) – Iowa Secretary of Agriculture Mike Naig issued the following statement today in response to Gov. Kim Reynolds’ signing Senate File 2403 into law, extending Iowa’s biofuel tax differentials to June 30, 2026.
“At a time of unprecedented challenges facing our renewable fuels industry, today is welcome news. The renewable fuels industry benefits Iowa farmers, supports jobs in rural communities and gives consumers access to affordable, cleaner-burning fuels,” said Secretary Naig. “Reauthorization of the biofuel tax differentials program will continue to boost biofuel demand. Gov. Reynolds’ commitment of an additional $7 million in funding for the RFIP program will allow us to further assist fuel marketers and retailers in building renewable fuels infrastructure, giving Iowans increased choices and savings at the pump. An investment in renewable fuels is an investment in Iowa."
Senate File 2403, a priority of Secretary Naig’s, extends and modernizes fuel tax differentials for E15 and higher ethanol blends and B11 and higher biodiesel blends, which are set to expire today on June 30, 2020. Since the first fuel tax differential bill was passed, E10 and higher ethanol blends and B11 and higher biodiesel blends, have grown to make up about 90 percent and 57 percent of sales in 2019, respectively. The new fuel tax differential modernizes the ethanol differential by applying it only to E15 and higher blends.
Iowa is one of a handful of states with a standing appropriation for a Renewable Fuels Infrastructure Program (RFIP). The RFIP helps the operators of motor fuel dispensing sites or fueling stations to convert their equipment to allow the expanded use of renewable fuels in Iowa. Since its inception, the RFIP program has distributed or obligated more than $36 million to help fund 335 E85 dispensers/blenders, 54 E15 projects, 343 biodiesel dispensers/blenders and 141 biodiesel terminals across Iowa. Fuel marketers and retailers have responded by investing over $200 million in these same projects.