Biofuels bill advances through Iowa subcommittees

February 18, 2021 | Bethany Baratta

Iowa Soybean Association (ISA) President Jeff Jorgenson this week provided comments to an Iowa House Ways and Means subcommittee and an Iowa Senate Ag subcommittee in support of Iowa Governor Kim Reynolds’ biofuels bill.

The Iowa Biofuel Standard Legislation is a policy proposed by Governor Reynolds that expands the use of biofuels grown and produced in Iowa.

“We are just eight months from harvesting another large soybean crop,” Jorgenson said. “We must ensure there is a stable and reliable market for this growth in production.”

Jorgenson appeared before the House subcommittee in person at the Iowa Capitol. Less than 30 minutes later, Jorgenson found a quiet hallway within the capitol to provide his testimony to the Senate subcommittee, which met virtually. 

He noted that the proposed legislation would create an additional 108 million bushels of soybean demand for Iowa farmers over the next five years. Iowa farmers grew just over 500 million bushels of soybeans last year.

Higher blends

For biodiesel, the legislation calls for fuel specifications that will increase demand of higher biofuel blends such as B20 and E15, thus improving the quality of the fuel supply.

By reforming existing biofuel tax credits, this legislation provides significant sources of revenue for the underfunded, overutilized Renewable Fuels Infrastructure Program (RFIP).

The proposed legislation would include a phased-in approach to the biodiesel standard:

• B11 standard effective from the date legislation passes and from April 1 to September 30.
• Transition blends allowed from April 1 to April 15.
• B20 standard would start on April 1, 2024.
• B5 blends allowed from October through March.

 

Support for infrastructure

The legislation supports increased infrastructure funding for higher biofuels blends while protecting the Iowa taxpayer.

Savings generated from the proposed biofuel tax credit reforms will provide roughly $10 million annually for the Renewable Fuels Infrastructure Program (RFIP). Over the coming years this funding will ensure that every retailer in Iowa that isn’t currently offering E15 will be able to receive a $50,000 grant to help fund equipment upgrades if they choose to add E15.

“It’s good Iowa public policy,” says Monte Shaw, executive director of the Iowa Renewable Fuels Association. “It’s good for farmers and it’s good for consumers.”

And it’s good for Iowa, the leader in biodiesel and ethanol production in the United States.

“This piece of legislation is critical to growing and supporting Iowa’s ag economy,” said Tim Bowdish, president and CEO of Elite Octane, an ethanol plant in Atlantic.

He noted that the state of California is the leading customer of U.S. biofuels. This legislation has the opportunity to use more of the state’s biofuels in the state.

“The ideal destination for our soybeans is right here in our own backyard where farmers, hard-working Iowans, and the communities we support can all share in the benefits of keeping it local,” Jorgenson said.

The appetite for on-farm biodiesel is also revving up, Jorgenson noted. 93 percent of Iowa soybean farmers responding to a survey last fall conducted by Harvest Research of Des Moines said they either use biodiesel, have used it in the past, or would like to use it to fuel their on-farm equipment.

Bills advance

The state Senate and House subcommittees both moved their respective bills forward. Members of both subcommittees indicated there will be revisions to the bill as proposed. Since the bill advanced through the subcommittees, it will come before the full Ways and Means and Agriculture committees in the coming weeks.

“It is vividly clear that we support biodiesel. It is vividly clear that we want to sell more biodiesel, and it’s clear that we can find a solution to get there,” said Senator Dan Zumbach, chair of the Senate Ag Committee.

Katie James contributed to this story.

---

Back