HF 2128 - Biofuels Legislation Heads to the Governor’s Desk

This week, both chambers of the legislature passed a bill that requires E-15 to be sold at gas stations across the state by the beginning of 2026. E-15 is gasoline that contains 15% ethanol by volume. Gas stations must dispense E-15 from one qualified motor fuel dispenser if there is only one available, or at least 50% of all qualified motor fuel dispensers.

The bill also provides grants, through a three-tiered system under the Renewable Fuel Infrastructure Program, to gas stations who install the infrastructure needed to provide ethanol. Tier I sites are gas stations that have never sold E-15 blends and did not sell more than 140,000 gallons of gasoline annually. They are eligible for state grants covering the lesser amount of 90% of the cost or $63,900. Tier II stations are those that have not sold E-15 blends but did sell more than 140,000 gallons of gasoline annually. They are eligible for state grants covering the lesser amount of 75% or $53,250. Tier III applies to all other gas stations in the state and qualify for grants covering 70% of the cost.

For smaller gas stations to be exempt from the requirements, they would have to show they existed prior to Jan. 1, 2023 and annual sales for 2020 to 2022 did not exceed 300,000 gallons. Gas stations can also apply for a waiver based on infrastructure’s incompatibility to store and dispense E-15 gasoline. Exemption applications must be sent to the Department of Agriculture.

The Iowa Senate passed this bill 42-3 and the Iowa House passed it 81-13. ABI was registered as undecided on this legislation.