|Dark green marks the states with enacted RFS and light green the states currently in legislative process.|
Iowa Governor Tom Vilsack today signed several pieces of legislation designed to grow Iowa’s renewable energy and bio-energy industries, including a state Renewable Fuels Standard (RFS) of 25% by 2020—the most aggressive state RFS yet. (Earlier post.) Other bills promote wind, solar, and new uses for soy-based products.
Iowa becomes the fifth state to enact legislation defining a state-level RFS; another six states are in varying stages of the legislative process with their own RFS proposals.
In January, I asked legislators to make a long-term commitment to my vision of making Iowa the nation’s leader in renewable fuels production. This legislation will help propel our nation into an era of clean energy and renewable fuel use that eases our dependence on foreign oil. With our continuing progress, Iowa is set to become the leader in research, development, and distribution of all forms of renewable energy.—Governor Vilsack
The House bill, HF 2754, and its companion appropriation bill, HF 2759, create:
A renewable fuels standard (RFS) starting at 10% in 2009 and increasing to 25% by 2019.
A new ethanol promotion tax credit for each gallon of ethanol blended into gasoline (replaces existing tax credit beginning in 2009). This incentive is linked to a retailer dealer’s achievement of the RFS schedule. The tax credit increases from 2.5 cents per gallon (c/g) for retailers within 4% of the RFS schedule to 6.5 c/g for retailers meeting or exceeding the RFS schedule.
A retail tax credit for E85 of 25 c/g (phases out by 2020).
A retail tax credit for biodiesel blends of 3 c/g (for retailers who sell more than 50% biodiesel blends.
$13 million over three year to expand an infrastructure program designed to help retailers and wholesalers offset the cost of bringing E85 and biodiesel blends to consumers.
The RFS does not mandate a specific blend percentage, but allows gasoline retailers flexibility in meeting the standard through the sale of E10, E85, and biodiesel blends.
Currently, Iowa has 25 ethanol refineries with the capacity to produce over 1.5 billion gallons annually. There are 4 ethanol refineries and two major expansions under construction with a combined annual capacity of 425 million gallons. In addition, Iowa has 6 biodiesel refineries with a combined annual capacity of over 100 million gallons either in operation or under construction.