Make all gas in Iowa contain ethanol

Thirty-one states use a higher percentage of ethanol than Iowa, and producers of the fuel plan to ask the Legislature to pass a bill requiring that all motor gasoline sold carry at least 10 percent ethanol.

Despite being the largest ethanol producer in the United States, Iowa has never required ethanol use in gasoline sold within the state. Motorists can buy non-ethanol-blended gasoline at most retail stations.

Gov. Chet Culver said Monday that an E10 blend mandate is a "step in the right direction." But the legislative outlook for an Iowa mandate is unclear, and opponents are lined up to fight the proposal.

"If an ethanol mandate is imposed in Iowa, it will cause gas prices to rise," said Dawn Carlson, president of the 1,500-member Petroleum Marketers and Convenience Stores of Iowa. Critics say that states with mandates, such as Minnesota, have higher fuel prices and that ethanol results in lower gas mileage.

Legislation in works for Iowa Senate

Sen. Jack Kibbie, D-Emmetsburg, said he will introduce a bill requiring 10 percent ethanol blends for highway use.

"People in Iowa like ethanol, they just don't like to be told what to do," said Kibbie, whose district includes a Poet ethanol plant at Emmetsburg. "People need to understand that without ethanol, corn and farmland would be worth about half as much as they are today."

Culver said an ethanol mandate "can make a statement about our commitment to biofuels and solidify our position as a national leader in the green economy."

Monte Shaw, executive vice president of the Iowa Renewable Fuels Association, said the percentage of fuel sold in Iowa blended with ethanol is less than 75 percent, while the percentage of ethanol-blended gasoline now averages 80 percent in the rest of the nation.

"Iowa is lagging behind the rest of the country in ethanol use," Shaw said at the Iowa Renewable Fuels Association annual meeting Monday in Des Moines.

Carlson disputed that, saying "figures from the Iowa Department of Revenue show that ethanol usage is really more than 80 percent."

Shaw said the approximately 100 million gallons of ethanol now sold in Iowa would be increased to about 140 million gallons were a state mandate passed.

Iowa production leads; many states require use

Iowa is the nation's largest producer of ethanol, with about 3.2 billion gallons produced at its 39 ethanol production plants in 2009. About 1.1 billion bushels of Iowa's 2.4 billion-bushel corn crop goes to making ethanol.

The vast majority of the ethanol produced in Iowa is sent out of state.

The federal government has increasing requirements for ethanol use, rising from 10.5 billion gallons last year to 12 billion gallons this year and eventually to 36 billion gallons after 2020.

Figures for 2009 consumption are not yet available.

Twelve U.S. states have passed mandates in varying forms, ranging from tax credits to blend percentages of 2 to 10 percent - the current limit under federal regulations - or percentages of total use in the state.

Federal air regulations requiring nonfossil fuel additives covering large cities in Illinois, Michigan, New York and Texas provide a virtual requirement even without state mandates.

Some legislators oppose mandates

In 2009, the Iowa Senate approved a bill requiring that all diesel fuel sold in the state contain 5 percent biodiesel, made primarily from soybean oil. But the bill never made the House floor for debate.

State Rep. Annette Sweeney, R-Alden, said she has brought the matter up with the Republican caucus.

"I know there's interest in the bill and there will be more once the case is made for how important the ethanol industry is to Iowa," Sweeney said.

Sweeney, who farms in Hardin County, cited recent U.S. Department of Agriculture reports showing a surplus of more than 1.5 billion bushels of corn.

"Ethanol has been so important to Iowa's corn growers, and there is a question of what to do with the surplus," Sweeney said.

Rep. Dolores Mertz, D-Ottosen, chairman of the Iowa House Agriculture Committee, said "sentiment is against mandates. I go to Minnesota, where there is a mandate, and I notice that the price of gasoline often is higher than in Iowa."

Sen. Wally Horn, D-Cedar Rapids, said he is against such a bill. "I don't like mandates in any form," Horn said.

The ethanol industry is awaiting a decision from the Environmental Protection Agency on approval to increase the blend of ethanol in unleaded gasoline from 10 percent to 15 percent.

An increase could add another 7 billion gallons to the annual demand for ethanol.

source: desmoinesregister