DES MOINES, Iowa -- The Iowa Senate approved a bill on Tuesday that would require 10% of Iowa's fuel be renewable by 2010 and 25% by 2020, and offer incentives for retailers to help the cause.
Meanwhile, the Missouri House passed a bill on Monday requiring gasoline sold in the state to contain at least 10% agriculturally derived ethanol starting Jan. 1, 2008.
According to the Associated Press, the Iowa measure was passed 49 to 1 and will return to the House where a similar bill has already won approval. Most lawmakers said they [image-nocss] expect a version of the measure to pass.
"This may be the strongest renewable fuel bill in the nation," said State Senator David Johnson (R).
The bill would require 10% of Iowa's fuel be renewable by 2010, and 25% be renewable by 2020. It gives retailers a tax credit that's linked to their success in meeting the standards.
A separate proposal would offer $4 million in grants to help retailers install the renewable fuel tanks.
"We are the first state to invest in infrastructure," said Johnson, the bill's floor manager.
In a compromise designed to speed the bill's passage, lawmakers dropped a provision that would have boosted the tax on non-blended gasoline if the state didn't meet the targets for renewable fuel use.
Critics have said more than 70% of the gasoline sold in Iowa is mixed with ethanol and such a mandate would not significantly increase use.
Backers are focusing on seeking to expand the use of the heavier, 85% mix of ethanol-blended gasoline. Only a few dozen retailers in the state offer that fuel, and backers said automakers will not mass-produce vehicles using that fuel until it is more widely available.
The bill still faces more debate, but renewable fuel activists are already praising the effort. "This bill can help Iowa retailers and consumers to truly harness Iowa's unique ability to produce renewable fuels," said Monte Shaw, of the Iowa Renewable Fuels Association.
According to the St. Louis Business Journal, the Missouri bill, HB 1270, now goes to the state Senate for action. If the Senate passes the bill, Missouri will become the fifth state to have a statewide ethanol standard.
Unless a distributor is specifically exempted, the Missouri Renewable Fuel Standard permits the sale of blends lower than E10 or unblended gasoline should a distributor be unable to purchase fuel ethanol or fuel ethanol-blended gasoline at the same or lower price as unblended gasoline, said the report.
Missouri currently has three ethanol plants in production, two under construction and several others on the drawing board, according to the Missouri Corn Growers Association.
The association expects ethanol production in the state to reach at least 350 million gallons by 2008, surpassing the 280-million-gallon market that would be created by HB 1270. In 2003, according to the most recent data from the U.S. Federal Highway Administration, Missouri used a total of 88 million gallons of ethanol in various gasoline blends.
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