Iowa Legislature funds state’s biofuel infrastructure program

The Iowa Legislature authorized another year of funding June 14 for Iowa’s cost-share biofuel infrastructure program, a move that ensures access to biofuels will continue to grow throughout Iowa.

The Iowa Renewable Fuels Infrastructure Program provides Iowa fuel retailers with cost-share grants to add the necessary equipment to their stations to offer higher blends of biofuels. RFIP has led to millions of dollars of private economic investment and hundreds of new stations offering E15, E85 and biodiesel blends at the pump. The program’s funding of $3 million for FY2021 was included in HF 2642, a bill to fund the Rebuild Iowa Infrastructure Fund. It passed the Senate 45-3 and passed the House 63-29.

“IRFA members are grateful the Iowa legislature sees the value that ethanol and biodiesel production bring to our state by prioritizing this proven program that helps ensure the growth of biofuels production and use,” said Nathan Hohnstein, IRFA policy director. “This is great news at a time when it was truly needed. Response to the COVID-19 pandemic brought a deep cut to biofuels demand and while the slow climb of recovery has begun, many Iowa ethanol producers are still operating under capacity. Continuing the RFIP program will provide not only a boost in demand as more Iowa retailers add ethanol and biodiesel to their stations, but also increase consumer choice and save Iowans money at the pump.”

To date, RFIP has awarded $36 million in grants for more than 800 projects statewide that have spurred $200 million in private investment. Reimbursement can be up to 70 percent of the installation costs, up to a maximum of $50,000 per project, with a five-year commitment to sell E15, E85 or biodiesel blends. 

“While the level of funding is below what we sought this year, we realize the legislature is dealing with tough financial decisions just like we are, and we appreciate them maintaining the $3 million funding the program has historically received,” Hohnstein said. “We will continue to work with Gov. Kim Reynolds, Secretary Mike Naig, and other elected officials to look for nontraditional sources of funding for this vital program. We know that demand for the cost-share grants will be at an all-time high and given the precarious state of Iowa’s ag economy we cannot afford to run short of funds when they are needed most.”

For more on the program, click here.