Iowa House overwhelmingly approves E15 requirement

New legislation that would require Iowa gas stations to sell a gasoline blend that contains 15% ethanol swept through the Iowa House of Representatives in one week and was approved Wednesday 82 to 10.

“This bill has come a long way since its conception a year ago,” said Rep. Lee Hein, R-Monticello. “It means a lot to the people in agriculture.”

Blends of 10% ethanol — known as E10 — are most commonly sold. A recent study said the switch from E10 to E15 would increase demand for ethanol by 61 million gallons and would net $73 million of new income for agriculture and biofuels industries.

A similar bill proposed by Gov. Kim Reynolds failed to generate enough support for passage last year, in part because it would have required nearly all gasoline pumps to dispense E15.

The new bill, House File 2128, calls for at least half of pumps to be E15, but it allows fueling stations with antiquated tanks and pipes that aren’t approved for the higher blend to be exempted from the requirement.

Fueling stations can also get up to $50,000 to help pay for new infrastructure that can accommodate the blend.

“Promoting biofuels has never been a partisan issue, and today we saw what can be accomplished when we focus on what’s best for Iowa’s future,” said Monte Shaw, executive director of the Iowa Renewable Fuels Association.

A similar bill was considered earlier Wednesday by a Senate agriculture subcommittee, which moved Senate Study Bill 3084 forward to the full committee. Opponents of the bill said the potential costs for fueling stations to upgrade their tanks and pumps — especially in small towns — could shutter them.

“This will have devastating impacts,” said Nicole Johnson, chief financial officer for Molo Companies in Dubuque, which owns more than a dozen convenience stories and provides fuel to others. “I estimate that about 20 percent of our customers will likely choose to close stores.”

Diane Border, who owns a convenience store in tiny Victor in eastern Iowa, said: “I think it would be the end of my business.”

Another concern is the existing federal summertime prohibition of E15 sales. The fuel can technically be sold, but it must be marked as a flex fuel that is approved for a small percentage of vehicles on the road.

Listing E15 as a flex fuel “will cause sales to fall through the floor,” said Tom Cope, a lobbyist for Casey’s General Stores.

House lawmakers amended their bill Wednesday to remove ambiguity about exemptions from the E15 requirement. Lawmakers said the change would clarify that such waivers “shall” be issued rather than “may” be issued for those who qualify.

The House also removed the requirement that all newly installed tanks be compatible with E85, which is a gasoline blend with 85% ethanol and increases the tank cost.

The amendment also exempted marinas from the proposed requirements.

The amendment’s provisions are not in the Senate version of the bill. Senators could either keep working on the original bill or take up the House version.