Iowa Retailers Receive Incentives to Sell E15 Fuel

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Iowa Retailers Receive Incentives to Sell E15 Fuel


DES MOINES, Iowa -- Fuel retailers in Iowa who are unsure about selling E15, a blend of 15 percent ethanol and 85 percent gasoline, have a new reason to make it available to their customers: as of July 1, they are eligible for a 3-cent per gallon tax credit for every gallon of E15 sold, according to a KCAU-TV report.

"Retailers with blender pumps can take advantage of this new incentive right now," said Monte Shaw, executive director of the Iowa Renewable Fuels Association (IRFA). "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 percent of gasoline that goes into vehicles is eligible to use E15."

E15 can currently be sold to owners of flex-fuel vehicles. The Environmental Protection Agency recently finalized a rule allowing the blend to be sold to all passenger vehicles manufactured in 2001 and beyond. The rule goes into effect later this summer.

Iowa offers multiple incentives to make renewable fuels more available to customers, including an E85 tax credit of 10 cents per gallon; a biodiesel credit of 3 cents per gallon for blends of B2 and higher; an E100 tax credit of up to 8 cents per gallon, contingent on a retailer achieving Iowa's 25-percent Renewable Fuels Standard; and infrastructure grants of up to $50,000 for the installation of 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," said Shaw. "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." What’s more, retailers aren't the only ones who can save money in Iowa as a result of renewable fuels. Drivers in the state who use E10 have saved $50 million so far in 2011, according to a report that cited the IRFA.

"With high crude oil prices driving up the cost of nearly everything we buy, from food to clothing, it is nice to know ethanol is helping to reduce high gasoline prices," said Shaw.

State sales of ethanol remain steady at 75 percent of total gasoline sales, adding up to more than 500 million gallons pumped from January through May, according to the Iowa Department of Revenue, which also noted that E10 blends averaged a savings of 10 cents compared to 100-percent gasoline during that time.

A recent study by Iowa State University's Center for Agricultural and Rural Development also found that using ethanol expands the overall fuel supply and helps drive down the cost of all gasoline products, saving Midwestern drivers an average of $1.37 per gallon in 2010.

"Today, 25 percent of the gasoline produced from domestic resources is ethanol," said Shaw. "Having ethanol as an affordable, domestic alternative to high-priced foreign oil is paying big dividends -- for consumers, for jobs and for energy security."

The state currently has 142 locations that offer E85 and blender pumps. A full list can be found at