Iowa Takes Big Step to Tear Down Big Oil's Bogus Blend Wall

Iowa Takes Big Step to Tear Down Big Oil's Bogus Blend Wall

Legislation is passed to protect retailers, guaranteeing their rights to offer ethanol and biodiesel blends of their choice such as E15, E85 and B20.

The Iowa Renewable Fuels Association on May 22 applauded the Iowa Legislature's passage of H.F. 640 as a big step in supporting fuel choice for Iowa's fuel retailers and consumers. The legislation protects retailers from Big Oil efforts to restrict competition by guaranteeing local retailers the right to offer the ethanol and biodiesel blends of their choice, such as E15, E85 and B20.

NEW LEGISLATION: Passage of retailer "Bill of Rights" legislation by the 2013 Iowa Legislature shows the state's commitment to local fuel retailers and to providing consumers with fuel choice, says Rick Schwarck, president of the Iowa Renewable Fuels Association. The new law will help boost the retail availability of higher blends of ethanol and biodiesel in Iowa such as E15, E85 and B20.

"This legislation represents a solid step forward for higher ethanol blends, consumer choice, and the federal Renewable Fuel Standard," says IRFA president Rick Schwarck, CEO of Absolute Energy, an ethanol plant at St. Ansgar in northern Iowa. "I find it ironic that Big Oil consistently claims that retailers don't want to sell higher ethanol blends like E15, yet they use every trick in the book to prevent retailers from offering E15. In fact, the American Petroleum Institute fought tooth and nail to try to keep these retailer protections out of the bill. This bill tears down one part of Big Oil's bogus blend wall in Iowa."

The legislation includes a section that amounts to a retailer 'Bill of Rights,' preventing oil refiners' supply agreements from directly or indirectly limiting the ability of local retailers to offer the ethanol and biodiesel blends they choose. The provision is based on a law enacted in South Dakota in 2011 and addresses specific, anti-competition provisions from actual refiner supply agreements. As a result, new supply agreements will not be allowed to:

* Restrict fuels from other suppliers;

* Restrict installing a blender pump;

* Restrict using current equipment from offering higher blends, like E15, E85 and B20;

* Restrict ethanol or biodiesel blends from being advertised;

* Restrict the locations where a retailer may offer the higher blends (like under a canopy);

* Restrict payment for higher blends to cash only (no credit cards)

"One supplier should not be allowed to dictate to local retailers what they can and cannot do with products from other suppliers," continues Schwarck. "More freedom for retailers to offer the fuels they choose often means more ethanol and biodiesel blends, which benefits consumers by increasing competition at the pump. And it also means more RINs will be generated for use in complying with the federal RFS."

Iowa is the leader in renewable fuels production. Iowa has 41 ethanol refineries capable of producing over 3.7 billion gallons annually, with one wet mill and two cellulosic ethanol facilities currently under construction. In addition, Iowa has 12 biodiesel facilities with the capacity to produce nearly 315 million gallons annually.

The Iowa Renewable Fuels Association was formed in 2002 to represent the state's liquid renewable fuels industry. The trade group fosters the development and growth of the renewable fuels industry in Iowa through education, promotion, legislation and infrastructure development. For more information, see the IRFA website.

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