Iowa fuel retailers are the first in the nation to have an incentive for selling E15, a blend of 15% ethanol and 85% gasoline. Effective July 1, 2011, retailers are eligible for a 3-cent per gallon tax credit for every gallon of E15 sold. Today, E15 can be sold to flex-fuel vehicle owners. Earlier this week the U.S. Environmental Protection Agency finalized a rule allowing E15 to be sold to all 2001 and newer passenger vehicles later this summer.
"Retailers with blender pumps can take advantage of this new incentive right now," says Monte Shaw, Iowa Renewable Fuels Association (IRFA) executive director. "With the EPA in the process of clearing the final hurdles, now is the time for all retailers to evaluate how E15 could fit into their business model. It is important to note that more than 74% of the gasoline in Iowa goes into vehicles that are eligible to use E15."
State of Iowa offers numerous incentives for renewable fuels
The state of Iowa offers numerous incentives to enhance renewable fuels availability to consumers. In addition to the new E15 incentive, retailers are eligible for:
- E85 tax credit of 10 cents per gallon;
- Biodiesel tax credit of 3 cents per gallon for blends of B2 and higher;
- E100 tax credit of up to 8 cents per gallon contingent upon a retailer's achievement of Iowa's 25% Renewable Fuels Standard; and,
- Infrastructure grants of up to $50,000 to install biodiesel, E85 and blender pumps.
"Capitalizing on this menu of incentives provides retailers with multiple options for providing their customers with a variety of renewable, domestic fuels," Shaw says. "Iowans have shown a preference for renewable fuels. These incentives give retailers the tools they need to provide an array of renewable fuels to consumers at the pump."
List shows locations of stations that have E85 and blender pumps
Iowa currently has 142 retail outlets offering E85 and 30 blender pumps offering various mid-level ethanol blends for flex-fuel vehicle owners. A list of all E85 stations can be found at www.iowarfa.org/ethanol_e85refueling.php.
Iowa is the leader in renewable fuels production, says Shaw. Iowa has 41 ethanol refineries capable of producing nearly 3.7 billion gallons annually. In addition, Iowa has 11 biodiesel facilities with the capacity to produce over 225 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.