An Iowa House committee approved a retooled version of Gov. Kim Reynolds’ controversial biofuels mandate proposal on Wednesday.
Fuel retailers rallied against Reynolds’ initial proposal, arguing that making the changes required under the bill could cost gas stations up to $1 billion in upgrades. CEO Ronald Langston of FUELIowa said his group was not consulted for the legislation, whereas agricultural groups had more sway.
“We don’t tell them what kind of corn and soybeans to plant,” Langston said of the agricultural interests pushing the bill. “Yet, in our case they are telling us what kind of fuel we will sell and how we are going to label our pumps.”
The legislation, House Study Bill 185, focuses on biofuels: ethanol, made of corn, and biodiesel, made of soybeans. Iowa is the nation’s top provider of both corn and ethanol, but much of Iowa’s ethanol is sold out of state.
The House Ways and Means Committee on Wednesday moved an amendment to the bill that strikes the entirety of Reynolds’s bill in favor of a 37-page proposal that softens some of the governor’s initial expectations.
Rep. Lee Hein, chair of the Ways and Means Committee, said the committee worked with interest groups, the Senate and the governor’s office to compile the amendment.
“This addresses a lot of the issues that different parties have brought,” Hein, R-Monticello, said.
The amendment would still require fuel retailers to phase out gasoline and prioritize biofuels.
Immediately on the passage of the bill, gas pumps would be required to have a “special-use label” for fuel without ethanol, known as E-0. By 2028, E-10 gas — that’s gasoline with 10% ethanol — would also require a special-use label, and all gas stations that sell E-0 would also need to offer E-15, a 15% ethanol blend.
Under the governor’s proposal, gas stations would be allowed to offer no-biofuel gas from just one pump. The amendment would allow fuel retailers to offer E-0 from any number of pumps.
The amended bill would also require diesel retailers to transition toward biofuels. The bill would immediately mandate gas stations to sell diesel with at least 11% biodiesel — B11 — from April to November. In the winter, there would be no mandatory minimum for biodiesel.
The amendment also lays out requirements for state vehicles to be biofuel-compatible and reporting schedules to track the progress of biofuel adoption. There would also be new tax credits for retailers that sell biofuels and incentives for building infrastructure that can handle up to E-85 and B-20 fuels.
The bill moves to the full House for consideration. A companion bill has not yet passed the Senate.