DES MOINES, Iowa -- The use of ethanol in Iowa is soaring as the state launches an initiative that will require that all gasoline retailers make their equipment compatible with the latest generation of ethanol: fuel that is 85% ethanol, 15% gasoline. Station managers will have two years to ensure their equipment can dispense E85, officials from the Iowa Department of Natural Resources (DNR) said, reported the Quad City Times.
Eighteen stations, mostly in northwest and central Iowa, now offer E85, said the report. And more cars registered in the state93,000 [image-nocss] in 2005 compared with 50,000 in 2004are equipped with the mechanics to handle E85, as manufacturers increase the makes and models available. Most stations in the state offer a 10% mix of ethanol now, with most cars able to handle that mixture, the report said.
"Ultimately, it is more energy efficient, better for the environment. We are not exporting dollars out of the country," Tami Foster, energy planner for the DNR, told the newspaper. And "it's often the best buy at the pump."
Ethanol reached a new record market share in May, the most recent figures available, at 76.1%. The former record was 71.9%, set in February.
Sales topped 100.3 million gallons of 10% blended ethanol in May, compared to 31.5 million gallons of gasoline, according to the report.
Fourteen ethanol plants are open in the state, many in the northwest because of the access to and price of corn there, Lucy Norton of the Iowa Corngrowers Association told the paper. Eleven more are either under construction or in planning, she added.
With more plants coming online, Norton said she expects to hit the 1 billion-gallon mark this year. Five years ago, the state was producing about half that much. That makes Iowa the number one ethanol-producing state in the country, with Illinois at second, she said. Much of it is exported to other states.
"It is extremely energy efficient," she said. "There is a net gain of 67% more energy than it takes to produce it. We've got something that we can produce here that is a renewable resource that is energy efficient."
The new E85 requirements for retailers "are to help prevent leakage that may occur from systems that are not compatible with the product," DNR officials said.
"The DNR has been and will continue to be a proponent for renewable fuels such as ethanol," Director Jeff Vonk told the paper. "Our support for the industry includes making sure the proper safeguards are in place so that the positive environmental contributions of renewable fuel aren't negated by equipment that may not be compatible with E85."
The Iowa Values Fund includes $325,000 in grants to help with any upgrades, officials said.
Separately, U.S. Senator Barack Obama (D-Ill.) last week praised a Metropolis, Ill., CITGO station for increasing the availability of E85 ethanol fuel in southern Illinois. It is only the 8th station south of I-64 to offer E85 fuel, reported the Mount Carmel Daily Republican Register.
"Our energy future should lie in Illinois fields of corn, not foreign fields of oil," he said. "So I'm pleased to hear that folks in Metropolis will now have another option at the pump. Increasing the production and availability of home-grown alternative fuels is an important step in showing that the United States Senate is serious about reducing our country's dangerous dependence on imported oil."
In the Senate, Obama authored legislation designed to increase the availability and demand for E85 by increasing the number of fueling stations where it is sold, said the report. The legislation would provide a 50% tax credit for the cost of building a new E85 vehicle refueling facility, up to $30,000.
The legislation has been included as part of both the transportation bill and the energy bill.
"Right now, gas in southern Illinois is about $2.26 per gallon, while E85 sells for about 36 cents less," said Obama. "If my legislation to provide a tax credit for the production of E85 fueling stations becomes law, more gas stations in southern Illinois will follow Metropolis CITGO's lead and provide E85, offering some much-needed relief from the high gas prices at the pump."
In Illinois, there are approximately 62 gas stations that have the capability of offering E85, the report said.
Also, Minnesota Governor Tim Pawlenty last week urged Congress to support legislation that would require the nation to produce 8 billion gallons of renewable fuel by the year 2012, a 53% increase over current levels, said The Minneapolis Star Tribune.
A House bill calling for that requirement is sponsored by Representative Gil Gutknecht (R-Minn.). Similar Senate legislation includes a 5 billion-gallon mandate.
Minnesota, which just passed a 20% ethanol mandate, is the only state that has such a law, said the report. But Pawlenty predicted other states will soon follow. "We are the unquestioned national champion on renewable fuel," he told the House Agriculture Committee, of which Gutknecht and Rep. Collin Peterson (D-Minn.), are members.
The ethanol industry has added more than 5,000 jobs and pumped $1.3 billion into Minnesota's economy, Pawlenty said. It has also improved environmental standards and reduced Minnesota's dependence on foreign oil, he said. "It gets us closer to the goal I set of making Minnesota the Saudi Arabia of renewable fuels," said Pawlenty, who was recently named chairman of the Governor's Ethanol Coalition, a group of state leaders working to increase ethanol use.
Renewable fuels now make up 3% of the nation's fuel supply. Should the legislation pass, they would make up 5%.
But James Mason, general manager of the Virginia Poultry Growers Cooperative, told the committee that he has "grave concerns" about Gutknecht's bill. A government-imposed ethanol mandate could hurt farmers' chicken and turkey production because they would have less corn to use as feed, Mason said. Already, 11% of the nation's corn crops are diverted toward ethanol production, and Mason predicted that could jump to 35% if the legislation is passed. "A renewable fuel standard at any level could put livestock and poultry producers at a competitive disadvantage in a tight corn market," he said. Mason urged Congress to pass the more modest, 5 billion-gallon requirement.
After the hearing, Pawlenty said he understood those concerns but is focused on helping get the legislation passed. "There's a broad interest in moving forward," he said. "We just need to do it in a way that's fair to the whole country."
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