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Naig: Renewable Fuels is an Investment in Iowa
Iowa Ag Connection - 07/01/2020

Iowa Secretary of Agriculture Mike Naig issued the following statement Tuesday 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 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.

Reynolds signed Senate File 2403, legislation that will lower the cost of E-15 and higher blends of renewable fuels in Iowa by changing how the state taxes higher-blend biofuels. The governor signed the bill during her weekly press conference at Pine Lake Corn Processors in Steamboat Rock.

"Iowa continues to lead on innovative ways to drive demand for biofuels," said Gov. Reynolds. "This legislation makes higher blend biofuels even cheaper at the pump while driving demand for homegrown renewable fuel."

Watch the bill signing ceremony on Facebook. The governor also announced an additional $7 million in funding, through the federal CARES act, for the Renewable Fuels Infrastructure Program. This state program offers cost-share dollars to fuel retailers who install or convert their equipment to allow the expanded use of renewable fuels in Iowa.

"I sincerely appreciate everyone who joined us today at Pine Lake Corn Processors, as well as U.S. Senators Chuck Grassley and Joni Ernst, for continuing to champion policies that help our farmers and Iowa's biofuels industry," Reynolds continued.

Earlier this week, Reynolds joined a bipartisan group of governors from Minnesota, South Dakota and Nebraska, calling on the EPA to reject the excessive number of retroactive small refinery exemptions to the federal Renewable Fuel Standard. The law exists for a reason and we need the EPA to stand by it.


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